Question 1

Price discrimination exists:

Accepted Answer

A)  only in perfectly competitive markets.
B)  because sellers try to exploit customers' different willingness to pay.
C)  in all industries,regardless of market structure.
D)  only when monopolies are present.E) A) and C)
F) A) and D)

Question 2

Firms can have a high degree of monopoly power and not be a perfect monopoly if they:

Accepted Answer

A)  control 80 to 90 percent of the market.
B)  are the single producer of a product.
C)  have only a small number of competitors.
D)  intimidate the other businesses in the market.E) A) and D)
F) B) and C)

Question 3

If the monopolist charges a high price,he will sell:

Accepted Answer

A)  as many as he supplies to the market at that price.
B)  more than demanders want to buy at that price.
C)  less than if he were to charge a lower price.
D)  more than if he were to charge a lower price.E) C) and D)
F) B) and C)

Question 4

The monopolist's outcome in the long run differs from that of the perfectly competitive firm in that it:

Accepted Answer

A)  has zero profits in the long run.
B)  charges a price above average total costs.
C)  charges a price where marginal costs equal average revenue.
D)  None of these statements is true.E) A) and B)
F) A) and C)

Question 5

This graph shows the cost and revenue curves faced by a monopoly. 
According to the graph shown,the profit being earned by this monopolist is:

Accepted Answer

A)  (P3 - P0) x Q1
B)  (P3 - P1) x Q1
C)  (P1 - P0) x Q1
D)  (P3 - P0) /Q1E) None of the above
F) B) and C)

Question 6

The existence of a monopoly:

Accepted Answer

A)  creates market inefficiencies.
B)  causes consumers to get less at a higher price.
C)  causes a reduction in total surplus.
D)  All of these statements are true.E) B) and D)
F) None of the above

Question 7

Price discrimination is:

Accepted Answer

A)  the practice of charging customers different prices for the same good.
B)  the practice of charging customers the same price for a variety of similar goods.
C)  choosing which prices to charge for certain items.
D)  the process of customers choosing items based on price.E) B) and C)
F) A) and D)

Question 8

The monopolist is always constrained by:

Accepted Answer

A)  the amount demanders are willing to buy at any given price.
B)  his production capacity.
C)  the barriers to entry.
D)  government regulation.E) B) and C)
F) C) and D)

Question 9

For a monopoly,marginal revenue for all units greater than 1:

Accepted Answer

A)  is always less than the price.
B)  can be negative.
C)  is zero when total revenues are maximized.
D)  All of these statements are true.E) C) and D)
F) B) and D)

Question 10

In general,with a monopolist's outcome,total surplus is:

Accepted Answer

A)  higher than that of a competitive market.
B)  lower than that of a competitive market.
C)  the same as that of a competitive market.
D)  Any of these is possible.E) B) and D)
F) C) and D)

Question 11

For a monopolist,marginal revenue for all units greater than 1:

Accepted Answer

A)  is always less than price.
B)  is always equal to price.
C)  is never less than price.
D)  is minimized at price.E) C) and D)
F) A) and C)

Question 12

For a monopolist,at the profit-maximizing level of output:

Accepted Answer

A)  price is greater than marginal revenue.
B)  marginal revenue is greater than average revenue.
C)  average revenue is greater than price.
D)  None of these statements is true.E) None of the above
F) C) and D)

Question 13

Natural monopolies:

Accepted Answer

A)  capture lowest costs per unit possible.
B)  capture profits by restricting output.
C)  pose a problem for policy-makers.
D)  All of these statements are true.E) A) and B)
F) A) and C)

Question 14

For a monopolist,at the profit-maximizing level of output:

Accepted Answer

A)  price is chosen according to demand.
B)  price is equal to marginal revenue.
C)  price is equal to marginal cost.
D)  All of these statements are true.E) C) and D)
F) A) and B)

Question 15

A firm that is the sole producer of a good or service with no close substitutes is called a:

Accepted Answer

A)  perfectly competitive firm.
B)  monopolist.
C)  oligopolist.
D)  monopolistically competitive firm.E) B) and C)
F) C) and D)

Question 16

The existence of a monopoly:

Accepted Answer

A)  creates a gain of total surplus.
B)  benefits the consumer.
C)  benefits the monopolist.
D)  All of these statements are true.E) All of the above
F) C) and D)

Question 17

This table represents the revenues faced by a monopolist. th unit is: A) zero. B) negative. C) $3,000. D) $500." class="answers-bank-image d-inline" rel="preload" >
Using the information in the table shown,the marginal revenue of the 6th unit is:

Accepted Answer

A)  zero.
B)  negative.
C)  $3,000.
D)  $500.E) None of the above
F) B) and C)

Question 18

Predatory pricing:

Accepted Answer

A)  is an aggressive business move to maintain market power.
B)  was used by DeBeers to maintain control over the diamond market.
C)  is when a firm intimidates others to maintain the high prices the largest firms set.
D)  All of these statements are true.E) B) and C)
F) A) and D)

Question 19

When the monopolist decides to supply a given amount to the market,it will:

Accepted Answer

A)  set the price higher than it would be in perfect competition.
B)  set the price higher than what demanders are willing to pay for that amount.
C)  only sell that amount if it charges what the demanders are willing to pay for that amount.
D)  set the price lower than the demand curve to create a perceived shortage.E) B) and D)
F) A) and D)

Question 20

For a monopolist,average revenues:

Accepted Answer

A)  are always equal to price.
B)  equal price only at the profit maximizing quantity.
C)  are always zero at the profit maximizing quantity.
D)  are maximized when total revenues are maximized.E) None of the above
F) C) and D)

Exam 14: Monopoly

For a monopolist,average revenues:

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The existence of a monopoly:

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For a monopolist,marginal revenue for all units greater than 1:

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Predatory pricing:

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For a monopolist,at the profit-maximizing level of output:

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For a monopolist,at the profit-maximizing level of output:

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Natural monopolies:

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The monopolist's outcome in the long run differs from that of the perfectly competitive firm in that it:

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The existence of a monopoly:

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Price discrimination exists:

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In general,with a monopolist's outcome,total surplus is:

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This table represents the revenues faced by a monopolist. Using the information in the table shown,the marginal revenue of the 6th unit is:

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When the monopolist decides to supply a given amount to the market,it will:

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Firms can have a high degree of monopoly power and not be a perfect monopoly if they:

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For a monopoly,marginal revenue for all units greater than 1:

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Price discrimination is:

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The monopolist is always constrained by:

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If the monopolist charges a high price,he will sell:

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A firm that is the sole producer of a good or service with no close substitutes is called a:

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This graph shows the cost and revenue curves faced by a monopoly. According to the graph shown,the profit being earned by this monopolist is:

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This table represents the revenues faced by a monopolist. Using the information in the table shown,the marginal revenue of the 6^th unit is:

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