Question 1

In the United States,government policies with respect to monopolies and collusion are embodied in

Accepted Answer

A) the U.S.Constitution. 
B) common law, which the United States adopted from English law. 
C) the Supreme Court. 
D) antitrust laws. 
A) the U.S.Constitution. 
B) common law, which the United States adopted from English law. 
C) the Supreme Court. 
D) antitrust laws.

Question 2

A public franchise

Accepted Answer

A) is a corporation that is owned by stockholders. 
B) results from ownership of a key raw material. 
C) is a government designation that a private firm is the only legal producer of a good or service. 
D) is an unregulated monopoly necessary for the public good. 
A) is a corporation that is owned by stockholders. 
B) results from ownership of a key raw material. 
C) is a government designation that a private firm is the only legal producer of a good or service. 
D) is an unregulated monopoly necessary for the public good.

Question 3

Long-run economic profits would most likely exist in which market structure?

Accepted Answer

A) monopoly, monopolistic competition and oligopoly 
B) monopoly and oligopoly 
C) monopoly and monopolistic competition 
D) monopoly only 
A) monopoly, monopolistic competition and oligopoly 
B) monopoly and oligopoly 
C) monopoly and monopolistic competition 
D) monopoly only

Question 4

Which of the following is true for a monopolist?

Accepted Answer

A) Being the only seller in the market, the monopolist faces a perfectly inelastic demand curve. 
B) Being the only seller in the market, the monopolist faces a perfectly elastic demand curve. 
C) Being the only seller in the market, the monopolist faces the market demand curve. 
D) Being the only seller in the market, the monopolist faces a downward sloping demand curve that lies below the marginal revenue curve. 
A) Being the only seller in the market, the monopolist faces a perfectly inelastic demand curve. 
B) Being the only seller in the market, the monopolist faces a perfectly elastic demand curve. 
C) Being the only seller in the market, the monopolist faces the market demand curve. 
D) Being the only seller in the market, the monopolist faces a downward sloping demand curve that lies below the marginal revenue curve.

Question 5

Figure 10-12
   
Figure 10-12 shows the cost and demand curves for a monopolist.
-Refer to Figure 10-12.Assume the firm maximizes its profits.What is the amount of consumer surplus?

Accepted Answer

A) $21 
B) $124 
C) $186 
D) $332 
A) $21 
B) $124 
C) $186 
D) $332

Question 6

If a monopolist's marginal revenue is $35 per unit and its marginal cost is $25,then

Accepted Answer

A) to maximize profit the firm should increase output. 
B) to maximize profit the firm should decrease output. 
C) to maximize profit the firm should continue to produce the output it is producing. 
D) Not enough information is given to say what the firm should do to maximize profit. 
A) to maximize profit the firm should increase output. 
B) to maximize profit the firm should decrease output. 
C) to maximize profit the firm should continue to produce the output it is producing. 
D) Not enough information is given to say what the firm should do to maximize profit.

Question 7

Figure 10-6
   
Figure 10-6 shows the cost and demand curves for a monopolist.
-Refer to Figure 10-6.The monopolist's total revenue is

Accepted Answer

A) $1,116. 
B) $1,488. 
C) $1,726.40 
D) $1,826. 
A) $1,116. 
B) $1,488. 
C) $1,726.40 
D) $1,826.

Question 8

Figure 10-15
   
Figure 10-15 shows the cost and demand curves for the Erickson Power Company.
-Refer to Figure 10-15.Erickson Power is a natural monopoly because

Accepted Answer

A) it is a power company and all power companies are natural monopolies. 
B) average total cost is still declining when it intersects demand. 
C) of its continually declining marginal revenue curve as output rises. 
D) its marginal cost lies entirely below its long-run average cost. 
A) it is a power company and all power companies are natural monopolies. 
B) average total cost is still declining when it intersects demand. 
C) of its continually declining marginal revenue curve as output rises. 
D) its marginal cost lies entirely below its long-run average cost.

Question 9

Identify the type of merger in each of the following situations and indicate how the post-merger concentration ratio for the industry is affected.
a.A steel company merges with a coal and iron ore mining company.b.Staples,a retailer of office supplies,acquires Office Depot,another retailer of office supplies.c.An oil company merges with pipeline,shipping,and railroad companies as well as refineries and gas stations.

Accepted Answer

a. This would be a vertical merger; the

Question 10

A public franchise gives the exclusive right to produce a product for 20 years from the date the product is invented.

Accepted Answer

A) True 
 B)False

Question 11

A horizontal merger

Accepted Answer

A) is a merger between firms in the same industry. 
B) results in a trust (for example, the Standard Oil Company). 
C) is a merger between firms at different stages of production of a good. 
D) was illegal in the United States until the Federal Trade Commission Act was passed by Congress in 1914. 
A) is a merger between firms in the same industry. 
B) results in a trust (for example, the Standard Oil Company). 
C) is a merger between firms at different stages of production of a good. 
D) was illegal in the United States until the Federal Trade Commission Act was passed by Congress in 1914.

In the United States,government policies with respect to monopolies and collusion are embodied in

A public franchise

Long-run economic profits would most likely exist in which market structure?

Which of the following is true for a monopolist?

Figure 10-12 Figure 10-12 shows the cost and demand curves for a monopolist. -Refer to Figure 10-12.Assume the firm maximizes its profits.What is the amount of consumer surplus?

If a monopolist's marginal revenue is $35 per unit and its marginal cost is $25,then

Figure 10-6 Figure 10-6 shows the cost and demand curves for a monopolist. -Refer to Figure 10-6.The monopolist's total revenue is

Figure 10-15 Figure 10-15 shows the cost and demand curves for the Erickson Power Company. -Refer to Figure 10-15.Erickson Power is a natural monopoly because

A public franchise gives the exclusive right to produce a product for 20 years from the date the product is invented.

A horizontal merger

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters

Exam 10: Monopoly and Antitrust Policy

In the United States,government policies with respect to monopolies and collusion are embodied in

A public franchise

Long-run economic profits would most likely exist in which market structure?

Which of the following is true for a monopolist?

Figure 10-12 Figure 10-12 shows the cost and demand curves for a monopolist. -Refer to Figure 10-12.Assume the firm maximizes its profits.What is the amount of consumer surplus?

If a monopolist's marginal revenue is $35 per unit and its marginal cost is $25,then

Figure 10-6 Figure 10-6 shows the cost and demand curves for a monopolist. -Refer to Figure 10-6.The monopolist's total revenue is

Figure 10-15 Figure 10-15 shows the cost and demand curves for the Erickson Power Company. -Refer to Figure 10-15.Erickson Power is a natural monopoly because

A public franchise gives the exclusive right to produce a product for 20 years from the date the product is invented.

A horizontal merger

Economics: Foundations and Models

Trade-Offs, comparative Advantage, and the Market System

Where Prices Come From: the Interaction of Demand and Supply

Market Efficiency and Market Failure

The Economics of Health Care

Firms, the Stock Market, and Corporate Governance

Consumer Choice and Elasticity

Technology, production, and Costs

Firms in Perfectly Competitive Markets

Monopolistic Competition and Oligopoly

Gdp: Measuring Total Production and Income

Unemployment and Inflation

Economic Growth, the Financial System, and Business Cycles

Aggregate Demand and Aggregate Supply Analysis

Money, banks, and the Federal Reserve System

Monetary Policy

Fiscal Policy

Comparative Advantage, international Trade, and Exchange Rates

Filters