Question 1

Table 15-4
A monopolist faces the following demand curve:  
-Refer to Table 15-4. In order to maximize profits, the monopolist should produce

Accepted Answer

A)  7.5 units. 
B)  10 units. 
C)  where marginal revenue equals marginal cost. 
D)  Both a and c are correct. 
A)  7.5 units. 
B)  10 units. 
C)  where marginal revenue equals marginal cost. 
D)  Both a and c are correct.

Question 2

Table 15-4
A monopolist faces the following demand curve:  
-Refer to Table 15-4. If the monopolist produces 5 units, what is its average revenue?

Accepted Answer

A)  $100 
B)  $20 
C)  $5 
D)  $4 
A)  $100 
B)  $20 
C)  $5 
D)  $4

Question 3

Table 15-5
A monopolist faces the following demand curve:  
-Refer to Table 15-5. The monopolist has total fixed costs of $60 and has a constant marginal cost of $15. What is the profit-maximizing level of production?

Accepted Answer

A)  2 units 
B)  3 units 
C)  4 units 
D)  5 units 
A)  2 units 
B)  3 units 
C)  4 units 
D)  5 units

Question 4

Figure 15-24  
-Refer to Figure 15-24. Which letter represents the profit-maximizing price chosen by the single price monopolist?

Accepted Answer

The answer of Figure 15-24  
-Refer to Figure 15-24....

Question 5

Figure 15-23  
-Refer to Figure 15-23. What type of monopoly is shown in the figure?

Accepted Answer

The answer of Figure 15-23  
-Refer to Figure 15-23....

Question 6

Table 15-3
Consider the following demand and cost information for a monopoly.  
-Refer to Table 15-3. The maximum profit this monopolist can earn is

Accepted Answer

A)  $5. 
B)  $15. 
C)  $16. 
D)  $28. 
A)  $5. 
B)  $15. 
C)  $16. 
D)  $28.

Question 7

Figure 15-25  
-Refer to Figure 15-25. If a regulator requires this firm to charge a socially optimal price, which letter represents the amount of output it will produce?

Accepted Answer

The answer of Figure 15-25  
-Refer to Figure 15-25....

Question 8

A monopolist's supply curve is horizontal.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements is not correct?

Accepted Answer

A)  The competitive firm produces where P = MC. 
B)  The monopolist produces where P = MC. 
C)  The competitive firm produces where MR = MC. 
D)  The monopolist produces where MR = MC. 
A)  The competitive firm produces where P = MC. 
B)  The monopolist produces where P = MC. 
C)  The competitive firm produces where MR = MC. 
D)  The monopolist produces where MR = MC.

Question 10

Figure 15-17  
-Refer to Figure 15-17. If this firm were able to perfectly price discriminate, which of the following areas would represent the profit to this perfectly discriminating monopolist?

Accepted Answer

A)  ABE 
B)  BCFE 
C)  EFG 
D)  ACG 
A)  ABE 
B)  BCFE 
C)  EFG 
D)  ACG

Question 11

Scenario 15-6
The concert promoters of a heavy-metal band, WeR2Loud, know that there are two types of concert-goers: die- hard fans and casual fans. For a particular WeR2Loud concert, there are 1,000 die-hard fans who will pay $150 for a ticket and 500 casual fans who will pay $50 for a ticket. There are 1,500 seats available at the concert venue. Suppose the cost of putting on the concert is $50,000, which includes the cost of the band, lighting, security, etc.
-Refer to Scenario 15-6. How much additional profit can the concert promoters earn by charging each customer their willingness to pay relative to charging a flat price of $150 per ticket?

Accepted Answer

A)  $25,000 
B)  $50,000 
C)  $75,000 
D)  $100,000 
A)  $25,000 
B)  $50,000 
C)  $75,000 
D)  $100,000

Question 12

Competitive firms differ from monopolies in which of the following ways?

Accepted Answer

A)  (i) and (ii) only 
B)  (ii) and (iii) only 
C)  (i) and (iii) only 
D)  (i), (ii), and (iii) 
A)  (i) and (ii) only 
B)  (ii) and (iii) only 
C)  (i) and (iii) only 
D)  (i), (ii), and (iii)

Question 13

Which of the following would be most likely to have monopoly power?

Accepted Answer

A)  a national florist 
B)  an online bookstore 
C)  a local restaurant 
D)  a local electrical cooperative 
A)  a national florist 
B)  an online bookstore 
C)  a local restaurant 
D)  a local electrical cooperative

Question 14

When a local grocery store offers discount coupons in the Sunday paper it is most likely trying to

Accepted Answer

A)  reduce prices for all customers. 
B)  encourage literacy. 
C)  encourage arbitrage. 
D)  price discriminate. 
A)  reduce prices for all customers. 
B)  encourage literacy. 
C)  encourage arbitrage. 
D)  price discriminate.

Question 15

A monopoly chooses to supply the market with a quantity of a product that is determined by the intersection of the

Accepted Answer

A)  marginal cost and demand curves. 
B)  average total cost and demand curves. 
C)  marginal revenue and average total cost curves. 
D)  marginal revenue and marginal cost curves. 
A)  marginal cost and demand curves. 
B)  average total cost and demand curves. 
C)  marginal revenue and average total cost curves. 
D)  marginal revenue and marginal cost curves.

Question 16

Figure 15-3  
-Refer to Figure 15-3. Which of the following statements is correct?

Accepted Answer

A)  Panel B represents the typical demand curve for a perfectly competitive firm. 
B)  Panel A represents the typical demand curve for a monopoly. 
C)  Panel A represents the typical demand curve for a perfectly competitive industry. 
D)  All of the above are correct. 
A)  Panel B represents the typical demand curve for a perfectly competitive firm. 
B)  Panel A represents the typical demand curve for a monopoly. 
C)  Panel A represents the typical demand curve for a perfectly competitive industry. 
D)  All of the above are correct.

Question 17

A monopoly firm can sell 150 units of output for $10 per unit. Alternatively, it can sell 151 units of output for $9.90 per unit. The marginal revenue of the 151st unit of output is

Accepted Answer

A)  -$5.10. 
B)  -$0.10. 
C)  $2.45. 
D)  $5.10. 
A)  -$5.10. 
B)  -$0.10. 
C)  $2.45. 
D)  $5.10.

Question 18

For a typical natural monopoly, average total cost is

Accepted Answer

A)  rising, often because marginal costs are very large. 
B)  rising, often because fixed costs are very large. 
C)  declining, often because marginal costs are very large. 
D)  declining, often because fixed costs are very large. 
A)  rising, often because marginal costs are very large. 
B)  rising, often because fixed costs are very large. 
C)  declining, often because marginal costs are very large. 
D)  declining, often because fixed costs are very large.

Question 19

Scenario 15-3
A monopoly firm maximizes its profit by producing Q = 500 units of output. At that level of output, its marginal revenue is $30, its average revenue is $60, and its average total cost is $34.
-Refer to Scenario 15-3. At Q = 500, the firm's total revenue is

Accepted Answer

A)  $13,000. 
B)  $15,000. 
C)  $17,000. 
D)  $30,000. 
A)  $13,000. 
B)  $15,000. 
C)  $17,000. 
D)  $30,000.

Question 20

The first major piece of antitrust legislation was the

Accepted Answer

A)  Clayton Act. 
B)  Obama Care Act. 
C)  Sherman Act. 
D)  Clinton Act. 
A)  Clayton Act. 
B)  Obama Care Act. 
C)  Sherman Act. 
D)  Clinton Act.

Exam 15: Monopoly

Table 15-4 A monopolist faces the following demand curve: -Refer to Table 15-4. In order to maximize profits, the monopolist should produce

Table 15-4 A monopolist faces the following demand curve: -Refer to Table 15-4. If the monopolist produces 5 units, what is its average revenue?

Table 15-5 A monopolist faces the following demand curve: -Refer to Table 15-5. The monopolist has total fixed costs of $60 and has a constant marginal cost of $15. What is the profit-maximizing level of production?

Figure 15-24 -Refer to Figure 15-24. Which letter represents the profit-maximizing price chosen by the single price monopolist?

Figure 15-23 -Refer to Figure 15-23. What type of monopoly is shown in the figure?

Table 15-3 Consider the following demand and cost information for a monopoly. -Refer to Table 15-3. The maximum profit this monopolist can earn is

Figure 15-25 -Refer to Figure 15-25. If a regulator requires this firm to charge a socially optimal price, which letter represents the amount of output it will produce?

A monopolist's supply curve is horizontal.

Which of the following statements is not correct?

Figure 15-17 -Refer to Figure 15-17. If this firm were able to perfectly price discriminate, which of the following areas would represent the profit to this perfectly discriminating monopolist?

Competitive firms differ from monopolies in which of the following ways?

Which of the following would be most likely to have monopoly power?

When a local grocery store offers discount coupons in the Sunday paper it is most likely trying to

A monopoly chooses to supply the market with a quantity of a product that is determined by the intersection of the

Figure 15-3 -Refer to Figure 15-3. Which of the following statements is correct?

A monopoly firm can sell 150 units of output for $10 per unit. Alternatively, it can sell 151 units of output for $9.90 per unit. The marginal revenue of the 151st unit of output is

For a typical natural monopoly, average total cost is

Scenario 15-3 A monopoly firm maximizes its profit by producing Q = 500 units of output. At that level of output, its marginal revenue is $30, its average revenue is $60, and its average total cost is $34. -Refer to Scenario 15-3. At Q = 500, the firm's total revenue is

The first major piece of antitrust legislation was the

Ten Principles of Economics

Thinking Like an Economist

Interdependence and the Gains From Trade

The Market Forces of Supply and Demand

Elasticity and Its Application

Supply, Demand, and Government Policies

Consumers, Producers, and the Efficiency of Markets

Application: the Costs of Taxation

Application: International Trade

Externalities

Public Goods and Common Resources

The Design of the Tax System

The Costs of Production

Firms in Competitive Markets

Monopolistic Competition

Oligopoly

The Markets for the Factors of Production

Earnings and Discrimination

Income Inequality and Poverty

The Theory of Consumer Choice

Frontiers of Microeconomics

Measuring a Nations Income

Measuring the Cost of Living

Production and Growth

Saving, Investment, and the Financial System

The Basic Tools of Finance

Unemployment

The Monetary System

Money Growth and Inflation

Open-Economy Macroeconomics: Basic Concepts

A Macroeconomic Theory of the Open Economy

Aggregate Demand and Aggregate Supply

The Influence of Monetary and Fiscal Policy on Aggregate Demand

The Short-Run Trade-Off Between Inflation and Unemployment

Six Debates Over Macroeconomic Policy

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