Question 1

Figure 11-6
  
-At its optimal output level,the profit-maximizing monopolist in Figure 11-6 will earn a profit equal to

Accepted Answer

A) zero. 
B) (P2 - P3)Q. 
C) P > Q. 
D) (P5 - P6 )Q. 
A) zero. 
B) (P2 - P3)Q. 
C) P > Q. 
D) (P5 - P6 )Q. B

Question 2

Figure 11-2
  
-In Figure 11-2,at what quantity would the monopolist maximize profit?

Accepted Answer

A) A 
B) B 
C) C 
D) D 
A) A 
B) B 
C) C 
D) D A

Question 3

Figure 11-3
  
-In Figure 11-3,which of the following is true,whether or not the monopolist is maximizing profits?

Accepted Answer

A) MR < P 
B) MC = P 
C) MC < AC 
D) MR = P 
A) MR < P 
B) MC = P 
C) MC < AC 
D) MR = P A

Question 4

Advertising by the monopolist

Accepted Answer

A) is not done because the monopolist has the only supply of the product and doesn't need to advertise. 
B) would have the effect of shifting its demand curve to the left. 
C) may lead to expanded production by the monopolist. 
D) makes no sense because there are no substitute commodities available to consumers. 
A) is not done because the monopolist has the only supply of the product and doesn't need to advertise. 
B) would have the effect of shifting its demand curve to the left. 
C) may lead to expanded production by the monopolist. 
D) makes no sense because there are no substitute commodities available to consumers.

Question 5

A monopoly may breed inefficiency by reducing competition and restricting production.

Accepted Answer

A) True 
 B)False

Question 6

Assume that a firm has measured demand carefully and thinks that the following table accurately displays this.The total cost has been measured and can be given as TC = 20 + Q + Q2 where Q is the level of output.Complete the table and determine the profit-maximizing level of output.
 $\begin{array} { c c c c } 
\text { Output } & \text { Total Revenue } & \text { Total Cost } & \text { Profit } \
1 & \$ 90 & ---& --- \
2 & 160 & ---& --- \
3 & 210 & ---& --- \
4 & 240 & ---& --- \
5 & 250 &---& --- \
6 & 240 & ---& --- \
7 & 210 & ---& --- \
8 & 160 & ---& --- \
9 & 90 & ---& --- \
10 & 0 & ---& --- \
\end{array}$

Accepted Answer

As indicated in the table below,the prof

Question 7

Natural monopolies are of theoretical,but not practical interest.

Accepted Answer

A) True 
 B)False

Question 8

A monopolist can earn a positive economic profit,even in the long run.

Accepted Answer

A) True 
 B)False

Question 9

Under monopoly,resources are allocated as efficiently as in perfect competition.

Accepted Answer

A) True 
 B)False

Question 10

Figure 11-9
  
-In Figure 11-9,which of the following is true?

Accepted Answer

A) MC = P B) MC = MR C) MU > MR D) MU < MC A) MC = P B) MC = MR C) MU > MR D) MU < MC

Question 11

A price-discriminating firm will always maximize profit by following the condition that

Accepted Answer

A) MR > MC. 
B) MR > P. 
C) MRa = MRb = MC. 
D) MR = ATC. 
A) MR > MC. 
B) MR > P. 
C) MRa = MRb = MC. 
D) MR = ATC.

Question 12

Explain why a monopolist does not have a supply curve.

Accepted Answer

Any firm,including a monopolist,has cost

Question 13

Control of a scarce resource or input can serve as an entry barrier.

Accepted Answer

A) True 
 B)False

Question 14

Draw the demand,marginal revenue and marginal cost curve for a monopolist.Show the equilibrium price and quantity supplied and total profit.Show the equilibrium price and quantity supplied and total profit.

Accepted Answer

Refer to F

Question 15

Providing medical services for smaller fees to the poor than to the rich is

Accepted Answer

A) misplaced charity. 
B) benevolent pricing. 
C) price discrimination. 
D) social pricing. 
A) misplaced charity. 
B) benevolent pricing. 
C) price discrimination. 
D) social pricing.

Question 16

Table 11-2
 $\begin{array} { c c c } 
\mathrm { Q } & \text { TR } & \text { TC } \
8 & 95 & 90 \
9 & 102 & 93 \
10 & 110 & 100 \
11 & 112 & 105 \
12 & 115 & 110
\end{array}$
-In Table 11-2,average cost at the profit-maximizing output is how much?

Accepted Answer

A) $5 
B) $8 
C) $10 
D) $11 
A) $5 
B) $8 
C) $10 
D) $11

Question 17

Figure 11-7
  
-For the firm in Figure 11-7,an unregulated monopolist,output falls below the efficient level in the short run by how much?

Accepted Answer

A) 50 
B) 75 
C) 35 
D) 100 
A) 50 
B) 75 
C) 35 
D) 100

Question 18

Price discrimination

Accepted Answer

A) may lead to greater output. 
B) always leads to a reduction of output. 
C) leads to lower profits for the firm. 
D) causes firms to operate at a higher cost. 
A) may lead to greater output. 
B) always leads to a reduction of output. 
C) leads to lower profits for the firm. 
D) causes firms to operate at a higher cost.

Question 19

Table 11-1 
 $\begin{array}{l}
\begin{array} { l } 
\text { Quantity (units) } \
\text { Price per unit (dollars) } \
\text { Total cost (dollars) }
\end{array}
\begin{array} { r r r r r r } 
18 & 16 & 14 & 12 & 10 & 4 \
1 & 2 & 3 & 4 & 5 & 6 \
44 & 38 & 32 & 26 & 20 & 14
\end{array}
\end{array}$
-Table 11-1 shows demand and total cost schedules for Monopoliteria.At its profit-maximizing level of output,Monopoliteria's profit is

Accepted Answer

A) $10. 
B) $15. 
C) $22. 
D) $30. 
A) $10. 
B) $15. 
C) $22. 
D) $30.

Question 20

Price discrimination is always illegal.

Accepted Answer

A) True 
 B)False

Exam 11: Monopoly

Figure 11-6 -At its optimal output level,the profit-maximizing monopolist in Figure 11-6 will earn a profit equal to

Figure 11-2 -In Figure 11-2,at what quantity would the monopolist maximize profit?

Figure 11-3 -In Figure 11-3,which of the following is true,whether or not the monopolist is maximizing profits?

Advertising by the monopolist

A monopoly may breed inefficiency by reducing competition and restricting production.

Natural monopolies are of theoretical,but not practical interest.

A monopolist can earn a positive economic profit,even in the long run.

Under monopoly,resources are allocated as efficiently as in perfect competition.

Figure 11-9 -In Figure 11-9,which of the following is true?

A price-discriminating firm will always maximize profit by following the condition that

Explain why a monopolist does not have a supply curve.

Control of a scarce resource or input can serve as an entry barrier.

Draw the demand,marginal revenue and marginal cost curve for a monopolist.Show the equilibrium price and quantity supplied and total profit.Show the equilibrium price and quantity supplied and total profit.

Providing medical services for smaller fees to the poor than to the rich is

Table 11-2 TR TC 8 95 90 9 102 93 10 110 100 11 112 105 12 115 110 -In Table 11-2,average cost at the profit-maximizing output is how much?

Figure 11-7 -For the firm in Figure 11-7,an unregulated monopolist,output falls below the efficient level in the short run by how much?

Price discrimination

Table 11-1 Quantity (units) Price per unit (dollars) Total cost (dollars) 18 16 14 12 10 4 1 2 3 4 5 6 44 38 32 26 20 14 -Table 11-1 shows demand and total cost schedules for Monopoliteria.At its profit-maximizing level of output,Monopoliteria's profit is

Price discrimination is always illegal.

What Is Economics

The Economy: Myth and Reality

The Fundamental Economic Problem: Scarcity and Choice

Supply and Demand: An Initial Look

Consumer Choice: Individual and Market Demand

Demand and Elasticity

Production,Inputs,and Cost: Building Blocks for Supply Analysis

Output,Price,and Profit: The Importance of Marginal Analysis

Securities: Business Finance,and the Economy: The Tail That Wags the Dog

The Firm and the Industry Under Perfect Competition

Between Competition and Monopoly

Limiting Market Power: Regulation and Antitrust

The Case for Free Markets I: the Price System

The Shortcomings of Free Markets

The Markets Prime Achievement: Innovation and Growth

Externalities, the Environment, and Natural Resources

Taxation and Resource Allocation

Pricing the Factors of Production

Labor and Entrepreneurship: The Human Inputs

Poverty, Inequality, and Discrimination

International Trade and Comparative Advantage

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