Question 1

If a restaurant was a natural monopoly,its

Accepted Answer

A) marginal cost curve would still be declining when it crossed the demand curve. 
B) average total cost curve would still be declining when it crossed the demand curve. 
C) marginal revenue curve wold be the same as its demand curve. 
D) marginal revenue curve would be horizontal. 
A) marginal cost curve would still be declining when it crossed the demand curve. 
B) average total cost curve would still be declining when it crossed the demand curve. 
C) marginal revenue curve wold be the same as its demand curve. 
D) marginal revenue curve would be horizontal.

Question 2

Online companies gather personal information about the customers who shop on their websites,and some of those companies will use the data to estimate price elasticities of the customers.Doing this is a way that these companies might be able to charge a higher price for a product to those customers who have a ________ price elasticity of demand.

Accepted Answer

A) high 
B) low 
C) negative 
D) unitary 
A) high 
B) low 
C) negative 
D) unitary

Question 3

A market economy benefits from market power

Accepted Answer

A) if the majority of the population are entrepreneurs. 
B) if firms with market power do research and development with the profits earned. 
C) if market power gets so bad the government creates public enterprises. 
D) under no circumstances. 
A) if the majority of the population are entrepreneurs. 
B) if firms with market power do research and development with the profits earned. 
C) if market power gets so bad the government creates public enterprises. 
D) under no circumstances.

Question 4

A monopolist currently sells 18 units of a good.If marginal revenue on the last unit sold is $117,then the price of the good must be less than $117.

Accepted Answer

A) True 
 B)False

Question 5

Figure 9-11   Figure 9-11 shows the cost and demand curves for a monopolist.
-Refer to Figure 9-11.Assume the firm maximises 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

A monopoly differs from monopolistic competition in that

Accepted Answer

A) a monopoly has market power while a firm in monopolistic competition does not have any market power. 
B) a monopoly can never incur a loss,but a firm in monopolistic competition can. 
C) in a monopoly there are significant entry barriers,but there are low barriers to entry in a monopolistically competitive market structure. 
D) a monopoly faces a perfectly inelastic demand curve while a monopolistic competitor faces an elastic demand curve. 
A) a monopoly has market power while a firm in monopolistic competition does not have any market power. 
B) a monopoly can never incur a loss,but a firm in monopolistic competition can. 
C) in a monopoly there are significant entry barriers,but there are low barriers to entry in a monopolistically competitive market structure. 
D) a monopoly faces a perfectly inelastic demand curve while a monopolistic competitor faces an elastic demand curve.

Question 7

Unlike a perfect competitor,a monopolist faces the market demand curve.

Accepted Answer

A) True 
 B)False

Question 8

Producers in perfect competition receive a smaller producer surplus than a monopoly producer.

Accepted Answer

A) True 
 B)False

Question 9

When a monopolist engages in perfect price discrimination,the quantity produced and sold

Accepted Answer

A) is lower than the quantity produced and sold if it adopted a single price. 
B) is larger than the quantity produced and sold if it adopted a single price. 
C) is the same level as that produced and sold if it adopted a single price. 
D) could be lower,higher or the same as that produced and sold if it adopted a single price. 
A) is lower than the quantity produced and sold if it adopted a single price. 
B) is larger than the quantity produced and sold if it adopted a single price. 
C) is the same level as that produced and sold if it adopted a single price. 
D) could be lower,higher or the same as that produced and sold if it adopted a single price.

Question 10

A firm that is the only seller of a good or service that does not have a close substitute is called

Accepted Answer

A) a monopoly. 
B) an oligopolist. 
C) a market maker. 
D) a price maker. 
A) a monopoly. 
B) an oligopolist. 
C) a market maker. 
D) a price maker.

Question 11

If a monopolist engages in first-degree price discrimination,it will produce the same output level as a perfectly competitive industry.

Accepted Answer

A) True 
 B)False

Question 12

Identify two ways by which the government controls monopolies?

Accepted Answer

The government control monopol

Question 13

Suppose that a perfectly competitive industry becomes a monopoly.What effect will this have on consumer surplus,producer surplus,and deadweight loss?

Accepted Answer

If a perfectly competitive ind

Question 14

Which of the following undermines a firm's ability to engage in price discrimination?

Accepted Answer

A) the seller's market power 
B) the inability to prevent resale of the product from one market segment to another 
C) buyers having different elasticities of demand for the product 
D) the seller's ability to segment the total market 
A) the seller's market power 
B) the inability to prevent resale of the product from one market segment to another 
C) buyers having different elasticities of demand for the product 
D) the seller's ability to segment the total market

Question 15

Because each customer pays according to her willingness to pay,a consumer maximises her consumer surplus under first-degree price discrimination.

Accepted Answer

A) True 
 B)False

Question 16

Many universities practice yield management.As a result,they offer different financial aid packages to different students.One result of yield management is that universities often

Accepted Answer

A) offer a less generous financial aid package to students who apply for an early admission decision. 
B) offer a more generous financial aid package to students who apply for an early admission decision. 
C) offer a less generous financial aid package to students with relatively high family incomes. 
D) offer a less generous financial aid package to students who don't participate in many extracurricular activities when they are in high school. 
A) offer a less generous financial aid package to students who apply for an early admission decision. 
B) offer a more generous financial aid package to students who apply for an early admission decision. 
C) offer a less generous financial aid package to students with relatively high family incomes. 
D) offer a less generous financial aid package to students who don't participate in many extracurricular activities when they are in high school.

Question 17

Many biologic drug manufacturers are pushing for patent protection to be extended to 12 years before generics are allowed to be introduced to the market.This reflects which of the following barriers to entry?

Accepted Answer

A) control of a key resource 
B) network externalities 
C) entry blocked by government action 
D) economies of scale creating a natural monopoly 
A) control of a key resource 
B) network externalities 
C) entry blocked by government action 
D) economies of scale creating a natural monopoly

Question 18

If a monopolist's price is $50 at the output where marginal revenue equals marginal cost and average total cost is $43,then the incremental profit from the last unit sold is $7.

Accepted Answer

A) True 
 B)False

Question 19

If a monopolist's price is $50 at 63 units of output,and marginal revenue equals marginal cost,and average total cost equals $43,then the firm's total profit is

Accepted Answer

A) $3150. 
B) $2709. 
C) $441. 
D) $7. 
A) $3150. 
B) $2709. 
C) $441. 
D) $7.

Question 20

Figure 9-3   Figure 9-3 above shows the demand and cost curves facing a monopolist.
-Refer to Figure 9-3.Suppose the monopolist represented in the diagram above produces positive output.What is the profit/loss per unit?

Accepted Answer

A) loss of $7 per unit 
B) profit of $30 per unit 
C) loss of $21 per unit 
D) profit of $14 per unit 
A) loss of $7 per unit 
B) profit of $30 per unit 
C) loss of $21 per unit 
D) profit of $14 per unit

If a restaurant was a natural monopoly,its

A market economy benefits from market power

A monopolist currently sells 18 units of a good.If marginal revenue on the last unit sold is $117,then the price of the good must be less than $117.

Figure 9-11 Figure 9-11 shows the cost and demand curves for a monopolist. -Refer to Figure 9-11.Assume the firm maximises its profits.What is the amount of consumer surplus?

A monopoly differs from monopolistic competition in that

Unlike a perfect competitor,a monopolist faces the market demand curve.

Producers in perfect competition receive a smaller producer surplus than a monopoly producer.

When a monopolist engages in perfect price discrimination,the quantity produced and sold

A firm that is the only seller of a good or service that does not have a close substitute is called

If a monopolist engages in first-degree price discrimination,it will produce the same output level as a perfectly competitive industry.

Identify two ways by which the government controls monopolies?

Suppose that a perfectly competitive industry becomes a monopoly.What effect will this have on consumer surplus,producer surplus,and deadweight loss?

Which of the following undermines a firm's ability to engage in price discrimination?

Because each customer pays according to her willingness to pay,a consumer maximises her consumer surplus under first-degree price discrimination.

Many universities practice yield management.As a result,they offer different financial aid packages to different students.One result of yield management is that universities often

Many biologic drug manufacturers are pushing for patent protection to be extended to 12 years before generics are allowed to be introduced to the market.This reflects which of the following barriers to entry?

If a monopolist's price is $50 at the output where marginal revenue equals marginal cost and average total cost is $43,then the incremental profit from the last unit sold is $7.

If a monopolist's price is $50 at 63 units of output,and marginal revenue equals marginal cost,and average total cost equals $43,then the firm's total profit is

Figure 9-3 Figure 9-3 above shows the demand and cost curves facing a monopolist. -Refer to Figure 9-3.Suppose the monopolist represented in the diagram above produces positive output.What is the profit/loss per unit?

Economics: Foundations and Models

Choices and Trade-Offs in the Market

Where Prices Come From: the Interaction of Demand and Supply

Elasticity: the Responsiveness of Demand and Supply

Economic Efficiency, Government Price Setting and Taxes

Consumer Choice and Behavioural Economics

Technology, Production and Costs

Firms in Perfectly Competitive Markets

Monopolistic Competition

Oligopoly: Firms in Less Competitive Markets

The Markets for Labour and Other Factors of Production

International Trade

Government Intervention in the Market

Externalities, Environmental Policy and Public Goods

The Distribution of Income and Social Policy

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Exam 9: Monopoly Markets

If a restaurant was a natural monopoly,its

A market economy benefits from market power

A monopolist currently sells 18 units of a good.If marginal revenue on the last unit sold is $117,then the price of the good must be less than $117.

Figure 9-11 Figure 9-11 shows the cost and demand curves for a monopolist. -Refer to Figure 9-11.Assume the firm maximises its profits.What is the amount of consumer surplus?

A monopoly differs from monopolistic competition in that

Unlike a perfect competitor,a monopolist faces the market demand curve.

Producers in perfect competition receive a smaller producer surplus than a monopoly producer.

When a monopolist engages in perfect price discrimination,the quantity produced and sold

A firm that is the only seller of a good or service that does not have a close substitute is called

If a monopolist engages in first-degree price discrimination,it will produce the same output level as a perfectly competitive industry.

Identify two ways by which the government controls monopolies?

Suppose that a perfectly competitive industry becomes a monopoly.What effect will this have on consumer surplus,producer surplus,and deadweight loss?

Which of the following undermines a firm's ability to engage in price discrimination?

Because each customer pays according to her willingness to pay,a consumer maximises her consumer surplus under first-degree price discrimination.

Many universities practice yield management.As a result,they offer different financial aid packages to different students.One result of yield management is that universities often

Many biologic drug manufacturers are pushing for patent protection to be extended to 12 years before generics are allowed to be introduced to the market.This reflects which of the following barriers to entry?

If a monopolist's price is $50 at the output where marginal revenue equals marginal cost and average total cost is $43,then the incremental profit from the last unit sold is $7.

If a monopolist's price is $50 at 63 units of output,and marginal revenue equals marginal cost,and average total cost equals $43,then the firm's total profit is

Figure 9-3 Figure 9-3 above shows the demand and cost curves facing a monopolist. -Refer to Figure 9-3.Suppose the monopolist represented in the diagram above produces positive output.What is the profit/loss per unit?

Economics: Foundations and Models

Choices and Trade-Offs in the Market

Where Prices Come From: the Interaction of Demand and Supply

Elasticity: the Responsiveness of Demand and Supply

Economic Efficiency, Government Price Setting and Taxes

Consumer Choice and Behavioural Economics

Technology, Production and Costs

Firms in Perfectly Competitive Markets

Monopolistic Competition

Oligopoly: Firms in Less Competitive Markets

The Markets for Labour and Other Factors of Production

International Trade

Government Intervention in the Market

Externalities, Environmental Policy and Public Goods

The Distribution of Income and Social Policy

Filters