Exam 10: Understanding Monopoly

Answer the following questions based on the accompanying graph. a.What is the profit-maximizing price and quantity for this firm? b.What is the price and quantity combination that creates the greatest economic welfare for society? At this price and quantity,is the firm making a profit or a loss? c.What will the firm do if it is incurring a loss? What is the lowest price the government could force the firm to charge?

The government has exercised control over monopoly practices since the passage of the

Answer the following questions based on the accompanying graph. a.What is the profit-maximizing price and quantity? b.At the profit-maximizing price and quantity,what are the total profits or losses made by this firm? c.At the profit-maximizing price and quantity,what is the approximate deadweight loss incurred by society?

In the movie Forrest Gump,the title character's Bubba Gump Shrimp Company is able to gain monopoly power in its market because of

Raising capital to compete against an entrenched monopolist

Refer to the accompanying figure to answer the following questions. -If this firm is profit maximizing,society would experience ________ in deadweight loss.

Economists view rent seeking as

Refer to the accompanying figure to answer the following questions. -If a firm is producing a quantity of 100 and charging a price of $25,it

Marie's Car Dealership is the only dealership in Victorville,California.The owner,Marie,experiences large economies of scale.Because she is the only seller of cars in the town,

The best way to limit competition is to

Compare and contrast natural barriers to entry and government-created barriers to entry.

Because the demand curve for a monopolist is downward sloping,

Market failure occurs

When resources are used to secure monopoly rights through the political process

Harnessing the benefits of competition,reducing trade barriers,and regulating markets are three

A tariff is a(n)

When a cable TV provider offers,say,ESPN and the Weather Channel together but not separately,the reason is that

Patents and copyright law

Both monopolies and competitive firms

Refer to the accompanying figure to answer the following questions. -If a firm is producing a quantity of 150 and charging a price of $13,it