Question 1

A monopolist maximizes profits by

Accepted Answer

A)   producing an output level where marginal revenue equals marginal cost.
B)   charging a price equal to marginal revenue and marginal cost.
C)   charging a price where marginal cost equals average total cost.
D)   Both a and b are correct.E) None of the above
F) A) and B)

Question 2

One method used to control the ability of firms to capture monopoly profit in the United States is through

Accepted Answer

A)   government purchase of products produced by monopolists.
B)   government distribution of a monopolist's excess production.
C)   enforcement of antitrust laws.
D)   regulation of firms in highly competitive markets.E) A) and C)
F) All of the above

Question 3

Figure 15-2 
-Refer to Figure 15-2.Which is more efficient,single price proft maximization or perfect price discrimination?

Accepted Answer

perfect pr...

Question 4

Because a monopolist is the sole producer in its market,it can necessarily alter the price of its good (i) 
Without affecting the quantity sold.
(ii) 
Without affecting its average total cost.
(iii) 
By adjusting the quantity it supplies to the market.

Accepted Answer

A)   (ii) only
B)   (iii) only
C)   (i) and (ii) only
D)   (ii) and (iii) onlyE) B) and C)
F) A) and C)

Question 5

A monopoly firm is a price

Accepted Answer

A)   taker and has no supply curve.
B)   maker and has no supply curve
C)   taker and has an upward-sloping supply curve.
D)   maker and has an upward-sloping supply curve.E) A) and D)
F) B) and C)

Question 6

Antitrust laws allow the government to

Accepted Answer

A)   prevent mergers.
B)   break up companies.
C)   promote competition.
D)   All of the above are correct.E) A) and D)
F) None of the above

Question 7

Table 15-6
A monopolist faces the following demand curve:
 
-Refer to Table 15-6.Suppose the monopolist has total fixed costs equal to $5 and a variable cost equal to $4 per unit for all units produced.What would the total profit be if she charged $6 per unit for her product?

Accepted Answer

A)   $1
B)   $3
C)   $8
D)   $15E) A) and B)
F) B) and C)

Question 8

Table 15-7
Sally owns the only shoe store in town.She has the following cost and revenue information.
 
-Refer to Table 15-7.What is the total variable cost of production when Sally produces six pairs of shoes?

Accepted Answer

A)   $100
B)   $295
C)   $600
D)   $620E) A) and C)
F) A) and D)

Question 9

Figure 15-16 
-Refer to Figure 15-16.If the monopoly firm perfectly price discriminates,then consumer surplus amounts to

Accepted Answer

A)   $0.
B)   $1,562.50.
C)   $3,125.
D)   $6,250.E) All of the above
F) A) and B)

Question 10

Figure 15-8 
-Refer to Figure 15-8.The deadweight loss caused by a profit-maximizing monopoly amounts to

Accepted Answer

A)   $150.
B)   $200.
C)   $250.
D)   $500.E) A) and B)
F) All of the above

Question 11

A natural monopoly occurs when

Accepted Answer

A)   the product is sold in its natural state,such as water or diamonds.
B)   there are economies of scale over the relevant range of output.
C)   the firm is characterized by a rising marginal cost curve.
D)   production requires the use of free natural resources,such as water or air.E) A) and D)
F) B) and C)

Question 12

Figure 15-2 
-Refer to Figure 15-2.If the monopolist uses perfect price discrimination,how much deadweight loss results?

Accepted Answer

The answer of Figure 15-2 
-Refer to Figure 15-2.If the...

Question 13

Which of the following statements is true? (i) 
When a competitive firm sells an additional unit of output,its revenue increases by an amount less than the price.
(ii) 
When a monopoly firm sells an additional unit of output,its revenue increases by an amount less than the price.
(iii) 
Average revenue is the same as price for both competitive and monopoly firms.

Accepted Answer

A)   (ii) only
B)   (iii) only
C)   (i) and (ii) only
D)   (ii) and (iii) onlyE) A) and D)
F) B) and C)

Question 14

If the government regulates the price that a natural monopolist can charge to be equal to the firm's marginal cost,the firm will

Accepted Answer

A)   earn zero profits.
B)   earn positive profits,causing other firms to enter the industry.
C)   earn negative profits,causing the firm to exit the industry.
D)   minimize costs in order to lower the price that it charges.E) C) and D)
F) A) and C)

Question 15

A monopolist maximizes profits by

Accepted Answer

A)   producing an output level where marginal revenue equals marginal cost.
B)   charging a price that is greater than marginal revenue.
C)   earning a profit of (P - M
C)  x Q.
D)   Both a and b are correct.E) B) and D)
F) C) and D)

Question 16

How does a competitive market compare to a monopoly that engages in perfect price discrimination?

Accepted Answer

A)   In both cases,total social welfare is the same.
B)   Total social welfare is higher in the competitive market than with the perfectly price discriminating monopoly.
C)   In both cases,some potentially mutually beneficial trades do not occur.
D)   Consumer surplus is the same in both cases.E) None of the above
F) B) and C)

Question 17

Which of the following is not correct?

Accepted Answer

A)   The demand curve facing a competitive firm is perfectly elastic.
B)   The demand curve facing a monopolist is the market demand curve.
C)   A monopolist can charge any price and sell any quantity that it chooses.
D)   A monopolist can alter the market price by adjusting the quantity that it produces.E) All of the above
F) C) and D)

Question 18

When a monopolist increases the quantity that it sells,price decreases,which,all else equal,decreases total revenue;this is called the price effect.

Accepted Answer

A) True 
 B)False

Question 19

If a monopolist has zero marginal costs,it will produce

Accepted Answer

A)   the output at which total revenue is maximized.
B)   in the range in which marginal revenue is still increasing.
C)   at the point at which marginal revenue is at a maximum.
D)   in the range in which marginal revenue is negative.E) B) and C)
F) A) and B)

Question 20

Figure 15-17 
-Refer to Figure 15-17.The consumer surplus at the monopolist's profit-maximizing price is

Accepted Answer

A)   $450.
B)   $900.
C)   $1,350.
D)   $2,025.E) C) and D)
F) All of the above

Exam 15: Monopoly

Table 15-6 A monopolist faces the following demand curve: -Refer to Table 15-6.Suppose the monopolist has total fixed costs equal to $5 and a variable cost equal to $4 per unit for all units produced.What would the total profit be if she charged $6 per unit for her product?

Correct Answer
verified

Figure 15-16 -Refer to Figure 15-16.If the monopoly firm perfectly price discriminates,then consumer surplus amounts to

Correct Answer
verified

A monopoly firm is a price

Correct Answer
verified

Figure 15-2 -Refer to Figure 15-2.Which is more efficient,single price proft maximization or perfect price discrimination?

Correct Answer
verified
perfect pr...
View Answer

How does a competitive market compare to a monopoly that engages in perfect price discrimination?

Correct Answer
verified

Table 15-7 Sally owns the only shoe store in town.She has the following cost and revenue information. -Refer to Table 15-7.What is the total variable cost of production when Sally produces six pairs of shoes?

Correct Answer
verified

A monopolist maximizes profits by

Correct Answer
verified

Figure 15-17 -Refer to Figure 15-17.The consumer surplus at the monopolist's profit-maximizing price is

Correct Answer
verified

Figure 15-8 -Refer to Figure 15-8.The deadweight loss caused by a profit-maximizing monopoly amounts to

Correct Answer
verified

Because a monopolist is the sole producer in its market,it can necessarily alter the price of its good (i) Without affecting the quantity sold. (ii) Without affecting its average total cost. (iii) By adjusting the quantity it supplies to the market.

Correct Answer
verified

When a monopolist increases the quantity that it sells,price decreases,which,all else equal,decreases total revenue;this is called the price effect.

Correct Answer
verified

A monopolist maximizes profits by

Correct Answer
verified

Correct Answer
verified

Which of the following is not correct?

Correct Answer
verified

One method used to control the ability of firms to capture monopoly profit in the United States is through

Correct Answer
verified

Figure 15-2 -Refer to Figure 15-2.If the monopolist uses perfect price discrimination,how much deadweight loss results?

Correct Answer
verified

If a monopolist has zero marginal costs,it will produce

Correct Answer
verified

If the government regulates the price that a natural monopolist can charge to be equal to the firm's marginal cost,the firm will

Correct Answer
verified

Antitrust laws allow the government to

Correct Answer
verified

A natural monopoly occurs when

Correct Answer
verified

Exam 15: Monopoly

Table 15-6 A monopolist faces the following demand curve: -Refer to Table 15-6.Suppose the monopolist has total fixed costs equal to $5 and a variable cost equal to $4 per unit for all units produced.What would the total profit be if she charged $6 per unit for her product?

Correct AnswerverifiedShow Answer

Figure 15-16 -Refer to Figure 15-16.If the monopoly firm perfectly price discriminates,then consumer surplus amounts to

Correct AnswerverifiedShow Answer

A monopoly firm is a price

Correct AnswerverifiedShow Answer

Figure 15-2 -Refer to Figure 15-2.Which is more efficient,single price proft maximization or perfect price discrimination?

Correct Answerverifiedperfect pr...View AnswerShow Answer

How does a competitive market compare to a monopoly that engages in perfect price discrimination?

Correct AnswerverifiedShow Answer

Table 15-7 Sally owns the only shoe store in town.She has the following cost and revenue information. -Refer to Table 15-7.What is the total variable cost of production when Sally produces six pairs of shoes?

Correct AnswerverifiedShow Answer

A monopolist maximizes profits by

Correct AnswerverifiedShow Answer

Figure 15-17 -Refer to Figure 15-17.The consumer surplus at the monopolist's profit-maximizing price is

Correct AnswerverifiedShow Answer

Figure 15-8 -Refer to Figure 15-8.The deadweight loss caused by a profit-maximizing monopoly amounts to

Correct AnswerverifiedShow Answer

Because a monopolist is the sole producer in its market,it can necessarily alter the price of its good (i) Without affecting the quantity sold. (ii) Without affecting its average total cost. (iii) By adjusting the quantity it supplies to the market.

Correct AnswerverifiedShow Answer

When a monopolist increases the quantity that it sells,price decreases,which,all else equal,decreases total revenue;this is called the price effect.

Correct AnswerverifiedShow Answer

A monopolist maximizes profits by

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Which of the following is not correct?

Correct AnswerverifiedShow Answer

One method used to control the ability of firms to capture monopoly profit in the United States is through

Correct AnswerverifiedShow Answer

Figure 15-2 -Refer to Figure 15-2.If the monopolist uses perfect price discrimination,how much deadweight loss results?

Correct AnswerverifiedShow Answer

If a monopolist has zero marginal costs,it will produce

Correct AnswerverifiedShow Answer

If the government regulates the price that a natural monopolist can charge to be equal to the firm's marginal cost,the firm will

Correct AnswerverifiedShow Answer

Antitrust laws allow the government to

Correct AnswerverifiedShow Answer

A natural monopoly occurs when

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
perfect pr...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified