Exam 9: Monopoly Markets

Joss is a marketing consultant.Iris and Daphne are potential customers interested in commissioning Joss to undertake a market survey and compile the findings in a report.Iris is willing to pay $500 for the service while Daphne is willing to pay $800.Suppose that the opportunity cost of Joss's time is $1200.Assume that Iris and Daphne do not know each other.Which of the following statements is true?

Figure 9-9 Figure 9-9 shows the demand and cost curves for a monopolist. -Refer to Figure 9-9.What is the difference between the monopoly's price and perfectly competitive industry's price?

A profit-maximising monopoly's price is

Perfect price discrimination is also known as

A monopoly is a seller of a product

Which of the following does not arise from price discrimination?

Some economists argue that Microsoft became a monopoly in the market for computer software by developing MS-DOS,an operating system used for the first IBM personal computers.The more people who used MS-DOS-based programs,the greater the usefulness of a using a computer with an MS-DOS operating system.The explanation for Microsoft's monopoly is

A merger between the Ford Motor Company and General Motors would be an example of a

Table 9-1 A monopoly producer of foreign language translation software faces a demand and cost structure as given in Table 9-1. -Refer to Table 9-1.What is the amount of the firm's profit?

If a theatre company expects $250 000 in ticket revenue from five performances and $288 000 in ticket revenue if it adds a sixth performance,the

Publishers practice price discrimination when they sell books at high prices to

Equilibrium in a perfectly competitive market results in the greatest amount of economic surplus,or total benefit to society,from the production of a good.Why,then,did Joseph Schumpeter argue that an economy may benefit more from firms that have market power than from firms that are perfectly competitive?

Consumers who will pay high prices to be among the first to own certain new products are called

Figure 9-13 Figure 9-13 shows the market demand and cost curves facing a natural monopoly. -Refer to Figure 9-13.Which of the following would be true if government regulators require the natural monopoly to produce at the economically efficient output level?

Arnold's Airport Transport provides passenger transportation to and from the local airport.Arnold charges a flat rate of $30 per person for round-trip service,and he gives a $5 discount to senior citizens.Assume Arnold's marginal cost is $3.00 per person.Draw two graphs,one showing demand and marginal cost for his $30 customers,of which he has 300 per month,and the other graph showing demand and marginal cost for his senior citizen customers,of which he has 100 per month.If Arnold charged all of his customers $30,he would have 325 customers per month.

Governments grant patents to

Table 9-1 A monopoly producer of foreign language translation software faces a demand and cost structure as given in Table 9-1. -Refer to Table 9-1.What is the firm's profit-maximising output and what is the price charged to sell this output?

What three conditions must hold for a firm to successfully price discriminate?

Which of the following is a reason why a firm would not engage in price discrimination?

Compared to perfect competition,the consumer surplus in a monopoly