Question 1

A market in which a single firm can produce,at a lower cost than multiple firms,the entire quantity of output demanded is called:

Accepted Answer

A)   diseconomies of scale.
B)   government intervention.
C)   a natural monopoly.
D)   price gouging.E) A) and B)
F) C) and D)

Question 2

The presence of a privately-owned monopoly helps:

Accepted Answer

A)   the monopolist.
B)   consumers.
C)   society overall.
D)   government.E) B) and C)
F) None of the above

Question 3

In the real world,price discrimination is more difficult because:

Accepted Answer

A)   it is difficult to identify and verify different groups.
B)   to perfectly discriminate, the firm must read people's minds to know their willingness to pay.
C)   it can be challenging to prevent the resale of goods from one group to another.
D)   All of these statements are true.E) C) and D)
F) All of the above

Question 4

A monopoly has:

Accepted Answer

A)   no competition at all.
B)   just a few large competitors.
C)   many competitors.
D)   no ability to set price.E) All of the above
F) None of the above

Question 5

If an inefficient public monopoly cannot provide a service at a price that sufficient numbers of people are willing to pay it:

Accepted Answer

A)   can remain in operation by covering its losses with revenue from taxes.
B)   must shut down and leave the industry in the long run.
C)   should expand operations until demand is satisfied.
D)   will seek out more efficiencies.E) C) and D)
F) A) and B)

Question 6

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

Accepted Answer

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

Question 7

This table represents the revenues faced by a monopolist. th unit is: A)  $0 B)  $200 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)   $0
B)   $200
C)   $3,000.
D)   $500.E) B) and D)
F) A) and B)

Question 8

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

Accepted Answer

A)   less than price because of the price effect.
B)   more than price because of the price effect.
C)   more than price because of the quantity effect.
D)   less than price because of the quantity effect.E) A) and B)
F) A) and C)

Question 9

Economists assume maximizing efficiency over other goals:

Accepted Answer

A)   is a guiding principle of policy-making.
B)   is always the best approach.
C)   should never be followed.
D)   may not bring about the best outcome for society.E) A) and B)
F) All of the above

Question 10

Most U.S.firms face:

Accepted Answer

A)   perfect competition.
B)   some degree of competition.
C)   market power resting in a few large firms in every industry.
D)   no competition at all.E) A) and C)
F) A) and D)

Question 11

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)   charges a price equal to MC.E) A) and C)
F) A) and D)

Question 12

One way DeBeers managed to maintain control over the diamond industry was to:

Accepted Answer

A)   continue to be the sole diamond producer by buying all existing diamonds.
B)   create the illusion of no close substitutes through marketing.
C)   punish consumers who sought to store their wealth in diamonds.
D)   All of these statements are true.E) A) and B)
F) A) and C)

Question 13

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

Question 14

Privatization of government agencies:

Accepted Answer

A)   has rarely occurred since the 1890s.
B)   has become less popular since the 1980s.
C)   has become more popular since the 1980s.
D)   happens more frequently during recessions.E) All of the above
F) None of the above

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) A) and C)

Question 16

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) A) and B)
F) A) and C)

Question 17

The government uses the antitrust laws in place:

Accepted Answer

A)   to prevent all mergers that would create market power.
B)   ineffectively because the laws are outdated.
C)   increasingly over time, as market power is getting more concentrated.
D)   to break up and prevent monopoly power in markets.E) B) and D)
F) A) and B)

Question 18

A perfect monopoly:

Accepted Answer

A)   refers to a single seller.
B)   can extract all consumer surplus from a market.
C)   controls 90 to 100 percent of the market for a product.
D)   would produce efficient outcomes.E) A) and B)
F) All of the above

Question 19

Monopoly power in a market causes:

Accepted Answer

A)   monopolists to profit.
B)   consumers to gain.
C)   market surplus to be constant
D)   governments to neve allow them.E) A) and B)
F) A) and C)

Question 20

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

Accepted Answer

A)   price is greater than average revenue.
B)   average revenue is greater than marginal cost.
C)   marginal cost is greater than price.
D)   total revenue is equal to total cost.E) None of the above
F) C) and D)

Exam 14: Monopoly

One way DeBeers managed to maintain control over the diamond industry was to:

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The presence of a privately-owned monopoly helps:

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If an inefficient public monopoly cannot provide a service at a price that sufficient numbers of people are willing to pay it:

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In the real world,price discrimination is more difficult because:

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Price discrimination is:

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Monopoly power in a market causes:

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Most U.S.firms face:

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Economists assume maximizing efficiency over other goals:

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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 is always:

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The government uses the antitrust laws in place:

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A market in which a single firm can produce,at a lower cost than multiple firms,the entire quantity of output demanded is called:

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A perfect monopoly:

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

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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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A monopoly has:

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Privatization of government agencies:

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

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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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