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Preguntas del test (35)
1Because monopoly firms do not have to compete with other firms, the outcome in a market with a monopoly is often
- Anot in the best interest of society.
- Bone that fails to maximize total economic well-being.
- Cinefficient.
- DAll of the above are correct.
2The fundamental source of monopoly power is
- Abarriers to entry.
- Bprofit.
- Cdecreasing average total cost.
- Da product without close substitutes.
3Refer to Figure 15-1. The shape of the average total cost curve reveals information about the nature of the barrier to entry that might exist in a monopoly market. Which of the following monopoly types best coincides with the figure?
- Aownership of a key resource by a single firm
- Bnatural monopoly
- Cgovernment-created monopoly
- Da patent or copyright monopoly
4Refer to Figure 15-1. Considering the relationship between average total cost and marginal cost, the marginal cost curve for this firm
- Amust lie entirely above the average total cost curve.
- Bmust lie entirely below the average total cost curve.
- Cmust be upward sloping.
- Ddoes not exist.
5The profit-maximization problem for a monopolist differs from that of a competitive firm in which of the following ways?
- AA competitive firm maximizes profit at the point where marginal revenue equals marginal cost; a monopolist maximizes profit at the point where marginal revenue exceeds marginal cost.
- BA competitive firm maximizes profit at the point where average revenue equals marginal cost; a monopolist maximizes profit at the point where average revenue exceeds marginal cost.
- CFor a competitive firm, marginal revenue at the profit-maximizing level of output is equal to marginal revenue at all other levels of output; for a monopolist, marginal revenue at the profit-maximizing level of output is smaller than it is for larger levels of output.
- DFor a profit-maximizing competitive firm, thinking at the margin is much more important than it is for a profit-maximizing monopolist.
6When a monopolist increases the number of units it sells, there are two effects on revenue. They are the
- Ademand effect and the supply effect.
- Bcompetition effect and the cost effect.
- Ccompetitive effect and the monopoly effect.
- Doutput effect and the price effect.
7For a monopolist, marginal revenue is
- Apositive when the demand effect is greater than the supply effect.
- Bpositive when the monopoly effect is greater than the competitive effect.
- Cnegative when the price effect is greater than the output effect.
- Dnegative when the output effect is greater than the price effect.
8Refer to Figure 15-4. A profit-maximizing monopoly will produce an output level of
- AQ1
- BQ2
- CQ3
- DQ4
9Refer to Figure 15-4. A profit-maximizing monopoly will charge a price of
- AP5
- BP4
- CP3
- DP2
10Refer to Figure 15-4. A profit-maximizing monopoly's total revenue is equal to
- AP4 x Q3.
- BP5 x Q1.
- CP3 x Q4.
- D(P4-P2) x Q3.
11Which of the following statements is correct? Monopolies are socially inefficient because they
(i) charge a price above marginal cost.
(ii) produce too little output.
(iii) earn profits at the expense of consumers.
(iv) maximize the market’s total surplus.- A(i) and (ii) only
- B(iii) only
- C(iii) and (iv) only
- D(i), (ii), (iii), and (iv)
12Price discrimination
- Aforces monopolies to charge a lower price as a result of government regulation.
- Bis an attempt by a monopoly to prevent some customers from purchasing its product by charging a high price.
- Cis an attempt by a monopoly to increases its profit by selling the same good to different customers at different prices.
- Dincreases the consumer surplus associated with a monopolistic market.
13With perfect price discrimination the monopoly
- Aeliminates all price discrimination by charging each customer the same price.
- Bcharges each customer an amount equal to the monopolist's marginal cost of production.
- Celiminates deadweight loss.
- Deliminates profits and increases consumer surplus.
14Which of the following statements is not correct?
- AMonopolistic competition is similar to monopoly because in each market structure the firm can charge a price above marginal costs.
- BMonopolistic competition is similar to perfect competition because both market structures are characterized by free entry.
- CMonopolistic competition is similar to oligopoly because both market structures are characterized by barriers to entry.
- DMonopolistic competition is similar to perfect competition because both market structures are characterized by many sellers.
15In a market that is characterized by imperfect competition,
- Afirms are price takers.
- Bthere are always a large number of firms.
- Cthere are at least a few firms that compete with one another.
- Dthe actions of one firm in the market never have any impact on the other firms' profits.
16Monopolistic competition is characterized by which of the following attributes (i) free entry
(ii) product differentiation
(iii) many sellers- A(i) and (iii) only
- B(i) and (ii) only
- C(ii) and (iii) only
- D(i), (ii), and (iii)
17Which of the following statements is correct?
- AMonopolistic competition is similar to monopoly because both market structures are characterized by patents.
- BMonopolistic competition is similar to perfect competition because both market structures are characterized by each seller being small compared to the market.
- CMonopolistic competition is similar to oligopoly because both market structures are characterized by free entry.
- DMonopolistic competition is similar to perfect competition because both market structures are characterized by excess capacity.
18For a monopolistically competitive firm,
- Amarginal revenue and price are the same.
- Baverage revenue and price are the same.
- Cat the profit-maximizing quantity of output, price equals marginal cost.
- Dat the profit-maximizing quantity of output, price equals the minimum of average total cost.
19To maximize its profit, a monopolistically competitive firm chooses its level of output by looking for the level of output at which
- Aprice equals marginal cost.
- Bmarginal revenue equals marginal cost.
- Caverage total cost is minimized.
- DAll of the above are correct.
20For a profit-maximizing monopolistically competitive firm, price exceeds marginal cost in
- Athe short run but not in the long run.
- Bthe long run but not in the short run.
- Cboth the short run and the long run.
- Dneither the short run nor the long run.
21When existing firms lose customers and profits due to entry of a new competitor, a
- Apredatory-pricing externality occurs.
- Bconsumption externality occurs.
- Cbusiness-stealing externality occurs.
- Dproduct-variety externality occurs.
22Advertising
- Aprovides information about products, including prices and seller locations.
- Bhas been proven to increase competition and reduce prices compared to markets without advertising.
- Csignals quality to consumers, because advertising is expensive.
- DAll of the above are correct.
23The debate over the efficiency of markets in which products with brand names are sold
- Ais framed by the role of regulation in advertising.
- Bis likely to be resolved by reference to anecdotal evidence.
- Chinges on whether consumers are rational in their choices.
- Dhinges on the effectiveness of advertising that identifies price differences.
24When monopolistically competitive firms advertise, in the long run
- Athey will still earn zero economic profit.
- Bthey can earn positive economic profit by increasing market share.
- Cthe market price must fall.
- Dthe market price must rise.
25A firm maximizes its profit by producing output up to the point where marginal revenue equals marginal cost
- Aonly when the market is a monopoly.
- Bonly when the market is a monopoly or monopolistically competitive.
- Conly when the market is monopolistically competitive or perfectly competitive.
- Dwhen the market is perfectly competitive, monopolistically competitive, or monopolistic.
26A firm produces the welfare-maximizing level of output
- Aonly when the market is perfectly competitive.
- Bonly when the market is a monopoly or monopolistically competitive.
- Conly when the market is monopolistically competitive or perfectly competitive.
- Dwhen the market is perfectly competitive, monopolistically competitive, or monopolistic.
27Which of the following statements about oligopolies is not correct?
- AAn oligopolistic market has only a few sellers.
- BThe actions of any one seller can have a large impact on the profits of all other sellers.
- COligopolistic firms are interdependent in a way that competitive firms are not.
- DUnlike monopolies and monopolistically competitive markets, oligopolies prices do not exceed their marginal revenues.
28Which of the following statements is correct?
- AIf duopolists successfully collude, then their combined output will be equal to the output that would be observed if the market were a monopoly.
- BAlthough the logic of self-interest decreases a duopoly’s price below the monopoly price, it does not push the duopolists to reach the competitive price.
- CAlthough the logic of self-interest increases a duopoly’s level of output above the monopoly level, it does not push the duopolists to reach the competitive level.
- DAll of the above.
29Refer to Table 17-2. If the market for gasoline in Pittsville is a monopoly, then the profit-maximizing monopolist will charge a price of
- A$8 and sell 200 gallons.
- B$5 and sell 500 gallons.
- C$2 and sell 800 gallons.
- D$0 and sell 1,000 gallons.
30Refer to Table 17-2. If the market for gasoline in Pittsville is perfectly competitive, then the equilibrium price of gasoline is
- A$8 and the equilibrium quantity is 200 gallons.
- B$5 and the equilibrium quantity is 500 gallons.
- C$2 and the equilibrium quantity is 800 gallons.
- D$0 and the equilibrium quantity is 1,000 gallons.
31Refer to Table 17-2. If there are exactly two sellers of gasoline in Pittsville and if they collude, then which of the following outcomes is most likely?
- AEach seller will sell 500 gallons and charge a price of $5.
- BEach seller will sell 250 gallons and charge a price of $2.50.
- CEach seller will sell 350 gallons and charge a price of $3.
- DEach seller will sell 250 gallons and charge a price of $5.
32Refer to Table 17-2. Suppose there are exactly two sellers of gasoline in Pittsville: Exxoff and BQ. If Exxoff sells 300 gallons and BQ sells 400 gallons, then
- AExxoff’s profit is $900 and BQ’s profit is $1,200.
- BExxoff’s profit is $2,100 and BQ’s profit is $2,400.
- Cthere is an excess demand for gasoline in Pittsville.
- Dthere is an excess supply of gasoline in Pittsville.
33As the number of sellers in an oligopoly becomes very large,
- Athe quantity of output approaches the socially efficient quantity.
- Bthe price approaches marginal cost.
- Cthe price effect is diminished.
- DAll of the above are correct.
34Refer to Table 17-17. In this game,
- Aneither player has a dominant strategy.
- Bboth players have a dominant strategy.
- CFirm A has a dominant strategy, but Firm B does not have a dominant strategy.
- DFirm B has a dominant strategy, but Firm A does not have a dominant strategy.
35Refer to Table 17-17. Which of the following outcomes represent the Nash equilibrium in this game?
- AQ=2 for Firm A and Q=3 for Firm B.
- BQ=3 for Firm A and Q=2 for Firm B.
- CThere is no Nash equilibrium in this game since neither player has a dominant strategy.
- DBoth a and b are correct.
Información
- Descripción
- Quiz on Untitled, created by Ryan Halcomb on 04/30/2018.
- Autor
- Ryan Halcomb
- Idioma
- English
- Visitas
- 75
- Valoración
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