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Problem Set #5

Bailey Newsome 8 questions

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Questions in this quiz (8)

  1. 1A natural monopoly occurs when the quantity demanded is ____________ the minimum quantity it takes to be at the bottom of the long-run average cost curve.
    1. Aany of the above are possible
    2. Bequal to
    3. Cless than
    4. Dgreater than
  2. 2Which of the following scenarios is an example of a barrier to entry?
    1. AJackie obtains a copyright for a new board game that she created
    2. BCrystal charges a higher price than her competitors for hair-styling services
    3. CDanny charges a lower price than his competitors for his consulting services
    4. DRoseanne offers free samples of her cupcakes to attract new customers
  3. 3Which one of the following is the most accurate description of a monopolist?
    1. Aa sole producer of a narrowly defined product, such as brown, Grade A eggs produced in Eagle County, Colorado
    2. Ba firm that is very large relative to all its competitors within a narrow product class
    3. Ca sole producer of a product for which good substitutes are lacking in a market with high barriers to entry
    4. Da large, multinational firm that produces an array of product categories
  4. 4A monopolist is able to maximize its profits by
    1. Asetting the price at the level that will maximize its total revenue
    2. Bproducing output where MR=MC and charging a price along the demand curve
    3. Csetting output at MR = MC and setting price at the demand curve's highest point
    4. Dproducing maximum output where price is equal to its marginal cost
  5. 5The following table shows a monopolist’s demand curve and cost information for the production of its good. What quantity will it produce?
    Image for question 5
    1. A10
    2. B20
    3. C30
    4. D40
  6. 6 If a firm holds a pure monopoly in the market and is able to sell 5 units of output at $4.00 per unit and 6 units of output at $3.90 per unit, it will produce and sell the sixth unit if its marginal cost is:
    1. A$3.40 or less
    2. B$3.50 or less
    3. C$3.90 or less
    4. D$4.00 or less
  7. 7For the restaurant industry in San Francisco, with dozens or hundreds of extremely small competitors, the value of the HHI:
    1. Amight drop as low as 100, but not less
    2. Bmight reach as low as 1000, but not less
    3. Cmight reach as high as 1000, but not more
    4. Dmight drop as low as 100 or even less
  8. 8Firms operating under cost-plus regulation have an incentive to generate high costs by building huge factories or employing lots of staff, because:
    1. Adoing so creates efficiencies and innovation
    2. Bthe market changes dramatically and they have incentive to meet new demand
    3. Cthis will reduce the firm's costs more quickly and it can make a high level of profit
    4. Dwhat they can charge is linked to the costs they incur.

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Description
Problem Sets Quiz on Problem Set #5, created by Bailey Newsome on 14/03/2022.
Language
English
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