Question 1

Apple and Google apply for hundreds of patents every year.These patents

Accepted Answer

A)  allow Apple and Google to produce goods with no risk of monetary loss. 
B)  provide incentives for Apple and Google to spend large amounts of money up front on research and development of new products. 
C)  create more competition among Apple,Google,and other tech firms than would occur without government intervention. 
D)  make it easy for Apple and Google products to be similar. 
E)  make it easy for other firms to compete with Apple and Google. 
A)  allow Apple and Google to produce goods with no risk of monetary loss. 
B)  provide incentives for Apple and Google to spend large amounts of money up front on research and development of new products. 
C)  create more competition among Apple,Google,and other tech firms than would occur without government intervention. 
D)  make it easy for Apple and Google products to be similar. 
E)  make it easy for other firms to compete with Apple and Google.

Question 2

After a patent on a product expires,

Accepted Answer

A)  other firms must wait to mimic the product. 
B)  all negative and positive externalities are internalized. 
C)  rivals can start to mimic the product. 
D)  no other firms can mimic the product. 
E)  no further profits are able to be made by the original producer of the good. 
A)  other firms must wait to mimic the product. 
B)  all negative and positive externalities are internalized. 
C)  rivals can start to mimic the product. 
D)  no other firms can mimic the product. 
E)  no further profits are able to be made by the original producer of the good.

Question 3

Problems raising capital is an example of

Accepted Answer

A)  a natural barrier. 
B)  consumer surplus. 
C)  a government-created barrier. 
D)  an externality. 
E)  inefficient output and price. 
A)  a natural barrier. 
B)  consumer surplus. 
C)  a government-created barrier. 
D)  an externality. 
E)  inefficient output and price.

Question 4

Refer to the accompanying figure to answer the following questions.
  
-If a firm is producing a quantity of 100 and charging a price of $10,it

Accepted Answer

A)  should continue to produce 100 units but raise the price to $13 to maximize profits. 
B)  should increase production to 150 units but raise the price to $25 to maximize profits. 
C)  should continue to produce 100 units but raise the price to $25 to maximize profits. 
D)  should increase production to 100 units and raise the price to $13 to maximize profits. 
E)  is already maximizing profits and should not change the price or quantity produced. 
A)  should continue to produce 100 units but raise the price to $13 to maximize profits. 
B)  should increase production to 150 units but raise the price to $25 to maximize profits. 
C)  should continue to produce 100 units but raise the price to $25 to maximize profits. 
D)  should increase production to 100 units and raise the price to $13 to maximize profits. 
E)  is already maximizing profits and should not change the price or quantity produced.

Question 5

One argument against patent and copyright laws is that they

Accepted Answer

A)  provide incentives to invest in research and development. 
B)  protect intellectual property. 
C)  hinder creativity. 
D)  increase competition. 
E)  limit exposure that can benefit companies and individuals. 
A)  provide incentives to invest in research and development. 
B)  protect intellectual property. 
C)  hinder creativity. 
D)  increase competition. 
E)  limit exposure that can benefit companies and individuals.

Question 6

Inefficient output and price,few choices for consumers,and rent seeking are all problems associated with

Accepted Answer

A)  externalities. 
B)  competitive markets. 
C)  monopolies. 
D)  scarcity. 
E)  trade. 
A)  externalities. 
B)  competitive markets. 
C)  monopolies. 
D)  scarcity. 
E)  trade.

Question 7

Economies of scale is an example of

Accepted Answer

A)  rent seeking. 
B)  consumer surplus. 
C)  a government-created barrier. 
D)  an externality. 
E)  a natural barrier. 
A)  rent seeking. 
B)  consumer surplus. 
C)  a government-created barrier. 
D)  an externality. 
E)  a natural barrier.

Question 8

Three examples of solutions to the problems of a monopoly are harnessing the benefits of ________,________ trade barriers,and ________ markets.

Accepted Answer

A)  competition; reducing; regulating 
B)  monopolies; reducing; regulating 
C)  competition; increasing; regulating 
D)  monopolies; increasing; regulating 
E)  competition; increasing; deregulating 
A)  competition; reducing; regulating 
B)  monopolies; reducing; regulating 
C)  competition; increasing; regulating 
D)  monopolies; increasing; regulating 
E)  competition; increasing; deregulating

Question 9

Refer to the accompanying figure to answer the following questions.
  
-This profit-maximizing firm's total profit is equal to

Accepted Answer

A)  $160. 
B)  -$160. 
C)  $320. 
D) -$320. 
E)  $100. 
A)  $160. 
B)  -$160. 
C)  $320. 
D) -$320. 
E)  $100.

Question 10

If cable companies were in a highly competitive market,we would expect

Accepted Answer

A)  cable companies to make profits in the long run. 
B)  customers to be unhappy about their cable package options. 
C)  a company to be willing to sell specific channels as well as packaged options. 
D)  cable companies to force us to choose between buying a little more cable than we really need or going without cable altogether. 
E)  deadweight loss in the market. 
A)  cable companies to make profits in the long run. 
B)  customers to be unhappy about their cable package options. 
C)  a company to be willing to sell specific channels as well as packaged options. 
D)  cable companies to force us to choose between buying a little more cable than we really need or going without cable altogether. 
E)  deadweight loss in the market.

Question 11

Refer to the accompanying figure to answer the following questions.
  
-At which price and quantity combination would the government regulate this firm to get as close as possible to the most efficient point for society?

Accepted Answer

A)  A and E 
B)  B and F 
C)  C and G 
D)  D and H 
E)  D and E 
A)  A and E 
B)  B and F 
C)  C and G 
D)  D and H 
E)  D and E

Question 12

Sandra's Steel Mill has decided that lobbying Congress to pass a tariff on imported steel will cost less than trying to modernize its facility to compete with foreign steel prices.Sandra's Steel Mill will

Accepted Answer

A)  decide that lobbying is wrong and modernize its facility. 
B)  participate in rent seeking and lobby Congress for the tariff. 
C)  lobby Congress for the tariff and modernize its facility. 
D)  produce more steel to attract more customers. 
E)  lower its price to compete with the imported foreign steel. 
A)  decide that lobbying is wrong and modernize its facility. 
B)  participate in rent seeking and lobby Congress for the tariff. 
C)  lobby Congress for the tariff and modernize its facility. 
D)  produce more steel to attract more customers. 
E)  lower its price to compete with the imported foreign steel.

Question 13

Refer to the accompanying figure to answer the following questions.
  
-The total cost when a firm is profit maximizing is

Accepted Answer

A)  $70,000. 
B)  $50,000. 
C)  $67,500. 
D)  $60,000. 
E)  $25,000. 
A)  $70,000. 
B)  $50,000. 
C)  $67,500. 
D)  $60,000. 
E)  $25,000.

Question 14

Refer to the accompanying figure to answer the following questions.
  
-Deadweight loss exists in a monopoly because the monopolist

Accepted Answer

A)  charges a price equal to marginal cost,which is higher than the price charged in a competitive market. 
B)  produces a quantity that is higher than the quantity produced in a competitive market. 
C)  makes a positive economic profit in the short run. 
D)  charges a price below marginal cost. 
E)  charges a price that is above marginal revenue. 
A)  charges a price equal to marginal cost,which is higher than the price charged in a competitive market. 
B)  produces a quantity that is higher than the quantity produced in a competitive market. 
C)  makes a positive economic profit in the short run. 
D)  charges a price below marginal cost. 
E)  charges a price that is above marginal revenue.

Question 15

Draw a graph of a typical natural monopoly.Label the profit-maximizing price and quantity P1 and Q1,respectively.Also label the price and quantity that will maximize total economic welfare P2 and Q2,respectively.Label the price and quantity that cause the firm to break even P3 and Q3,respectively.

Accepted Answer

The answer of Draw a graph of a typical natural...

Question 16

In the case of a natural monopoly,which government response is LEAST practical?

Accepted Answer

A)  leave the monopolist firm free to maximize its profits 
B)  buy the monopolist firm and operate it as a government-owned entity 
C)  force the monopolist to break up into firms that compete with one another 
D)  subsidize the monopoly,so it can operate at the socially optimal production level 
E)  regulate the monopolist firm's price,to equal average total cost 
A)  leave the monopolist firm free to maximize its profits 
B)  buy the monopolist firm and operate it as a government-owned entity 
C)  force the monopolist to break up into firms that compete with one another 
D)  subsidize the monopoly,so it can operate at the socially optimal production level 
E)  regulate the monopolist firm's price,to equal average total cost

Question 17

Refer to the accompanying figure to answer the following questions.
  
-When the price changes from $50 to $30,the output effect leads to an increase of ________ in revenue.

Accepted Answer

A)  $20 
B)  $15 
C)  $900 
D)  $600 
E)  $450 
A)  $20 
B)  $15 
C)  $900 
D)  $600 
E)  $450

Question 18

Refer to the accompanying figure to answer the following questions.
  
-If this firm is regulated at a point where price is $30,society would experience ________ in deadweight loss.

Accepted Answer

A)  $0 
B)  $112.50 
C)  $720 
D)  $525 
E)  $240 
A)  $0 
B)  $112.50 
C)  $720 
D)  $525 
E)  $240

Question 19

Which of the following is NOT a necessary characteristic of monopolies?

Accepted Answer

A)  Prices are set by the seller,not the consumer. 
B)  There is just one firm in the role of seller. 
C)  The market is for a unique product without close substitutes. 
D)  Government plays a role in maintaining barriers to entry. 
E)  The seller has a high level of market power. 
A)  Prices are set by the seller,not the consumer. 
B)  There is just one firm in the role of seller. 
C)  The market is for a unique product without close substitutes. 
D)  Government plays a role in maintaining barriers to entry. 
E)  The seller has a high level of market power.

Question 20

One benefit from tariffs would be

Accepted Answer

A)  the increase in efficiency. 
B)  the elimination of deadweight loss. 
C)  the increase in consumer surplus. 
D)  the protection of domestic businesses. 
E)  more imports into the country. 
A)  the increase in efficiency. 
B)  the elimination of deadweight loss. 
C)  the increase in consumer surplus. 
D)  the protection of domestic businesses. 
E)  more imports into the country.

Apple and Google apply for hundreds of patents every year.These patents

After a patent on a product expires,

Problems raising capital is an example of

Refer to the accompanying figure to answer the following questions. -If a firm is producing a quantity of 100 and charging a price of $10,it

One argument against patent and copyright laws is that they

Inefficient output and price,few choices for consumers,and rent seeking are all problems associated with

Economies of scale is an example of

Three examples of solutions to the problems of a monopoly are harnessing the benefits of , trade barriers,and markets.

Refer to the accompanying figure to answer the following questions. -This profit-maximizing firm's total profit is equal to

If cable companies were in a highly competitive market,we would expect

Refer to the accompanying figure to answer the following questions. -At which price and quantity combination would the government regulate this firm to get as close as possible to the most efficient point for society?

Sandra's Steel Mill has decided that lobbying Congress to pass a tariff on imported steel will cost less than trying to modernize its facility to compete with foreign steel prices.Sandra's Steel Mill will

Refer to the accompanying figure to answer the following questions. -The total cost when a firm is profit maximizing is

Refer to the accompanying figure to answer the following questions. -Deadweight loss exists in a monopoly because the monopolist

In the case of a natural monopoly,which government response is LEAST practical?

Refer to the accompanying figure to answer the following questions. -When the price changes from $50 to $30,the output effect leads to an increase of ________ in revenue.

Refer to the accompanying figure to answer the following questions. -If this firm is regulated at a point where price is $30,society would experience ________ in deadweight loss.

Which of the following is NOT a necessary characteristic of monopolies?

One benefit from tariffs would be

Five Foundations of Economics

Model Building and Gains From Trade

The Market at Work: Supply and Demand

Elasticity

Market Outcomes and Tax Incidence

Price Controls

Market Inefficiencies: Externalities and Public Goods

Business Costs and Production

Firms in a Competitive Market

Price Discrimination

Monopolistic Competition and Advertising

Oligopoly and Strategic Behavior

The Demand and Supply of Resources

Income,inequality,and Poverty

Consumer Choice

Behavioral Economics and Risk Taking

Health Insurance and Health Care

International Trade

Filters

Exam 10: Understanding Monopoly

Apple and Google apply for hundreds of patents every year.These patents

After a patent on a product expires,

Problems raising capital is an example of

Refer to the accompanying figure to answer the following questions. -If a firm is producing a quantity of 100 and charging a price of $10,it

One argument against patent and copyright laws is that they

Inefficient output and price,few choices for consumers,and rent seeking are all problems associated with

Economies of scale is an example of

Three examples of solutions to the problems of a monopoly are harnessing the benefits of ________,________ trade barriers,and ________ markets.

Refer to the accompanying figure to answer the following questions. -This profit-maximizing firm's total profit is equal to

If cable companies were in a highly competitive market,we would expect

Refer to the accompanying figure to answer the following questions. -At which price and quantity combination would the government regulate this firm to get as close as possible to the most efficient point for society?

Sandra's Steel Mill has decided that lobbying Congress to pass a tariff on imported steel will cost less than trying to modernize its facility to compete with foreign steel prices.Sandra's Steel Mill will

Refer to the accompanying figure to answer the following questions. -The total cost when a firm is profit maximizing is

Refer to the accompanying figure to answer the following questions. -Deadweight loss exists in a monopoly because the monopolist

Draw a graph of a typical natural monopoly.Label the profit-maximizing price and quantity P1 and Q1,respectively.Also label the price and quantity that will maximize total economic welfare P2 and Q2,respectively.Label the price and quantity that cause the firm to break even P3 and Q3,respectively.

In the case of a natural monopoly,which government response is LEAST practical?

Refer to the accompanying figure to answer the following questions. -When the price changes from $50 to $30,the output effect leads to an increase of ________ in revenue.

Refer to the accompanying figure to answer the following questions. -If this firm is regulated at a point where price is $30,society would experience ________ in deadweight loss.

Which of the following is NOT a necessary characteristic of monopolies?

One benefit from tariffs would be

Five Foundations of Economics

Model Building and Gains From Trade

The Market at Work: Supply and Demand

Elasticity

Market Outcomes and Tax Incidence

Price Controls

Market Inefficiencies: Externalities and Public Goods

Business Costs and Production

Firms in a Competitive Market

Price Discrimination

Monopolistic Competition and Advertising

Oligopoly and Strategic Behavior

The Demand and Supply of Resources

Income,inequality,and Poverty

Consumer Choice

Behavioral Economics and Risk Taking

Health Insurance and Health Care

International Trade

Filters

Three examples of solutions to the problems of a monopoly are harnessing the benefits of , trade barriers,and markets.