Question 1

Figure 15-11 
-Refer to Figure 15-11.Which area represents the deadweight loss from monopoly?

Accepted Answer

A)   A+B
B)   C+F
C)   G
D)   A+B+C+FE) A) and C)
F) B) and C)

Question 2

The profit that a monopolist earns represents a loss to society that is measured through deadweight loss.

Accepted Answer

A) True 
 B)False

Question 3

The three main sources of barriers to entry are monopoly resources,government regulation,and the firm's production process.

Accepted Answer

A) True 
 B)False

Question 4

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 marginal revenue from selling the 2nd pair of shoes?

Accepted Answer

A)   $140
B)   $150
C)   $160
D)   $170E) B) and C)
F) All of the above

Question 5

A patent gives a single person or firm the exclusive right to sell some good or service for a specific period of time.

Accepted Answer

A) True 
 B)False

Question 6

Which of the following can eliminate the inefficiency inherent in monopoly pricing?

Accepted Answer

A)   arbitrage
B)   cost-plus pricing
C)   price discrimination
D)   regulations that force monopolies to reduce their levels of outputE) C) and D)
F) A) and B)

Question 7

When a firm has a natural monopoly,the firm's

Accepted Answer

A)   marginal cost always exceeds its average total cost.
B)   total cost curve is horizontal.
C)   average total cost curve is downward sloping.
D)   marginal cost curve must lie above the firm's average total cost curve.E) A) and C)
F) None of the above

Question 8

Table 15-3
Consider the following demand and cost information for a monopoly.
 
-Refer to Table 15-3.The maximum profit this monopolist can earn is

Accepted Answer

A)   $5.
B)   $15.
C)   $16.
D)   $28.E) A) and B)
F) B) and C)

Question 9

A rational pricing strategy for a profit-maximizing monopolist is

Accepted Answer

A)   price discrimination.
B)   price segregation.
C)   synergy pricing.
D)   average cost pricing.E) A) and B)
F) A) and C)

Question 10

A market force that can prevent firms from price discriminating is

Accepted Answer

A)   fluctuating resource prices.
B)   arbitrage.
C)   high fixed costs.
D)   marginal-cost pricing.E) A) and C)
F) A) and B)

Question 11

The difference in total surplus between the socially efficient level of production and the monopolist's level of production is

Accepted Answer

A)   offset by regulatory revenues.
B)   called a deadweight loss.
C)   equal to the monopolist's profit.
D)   Both b and c are correct.E) B) and C)
F) All of the above

Question 12

Monopolies use their market power to

Accepted Answer

A)   charge prices that equal minimum average total cost.
B)   increase the quantity sold as they increase price.
C)   charge a price that is higher than marginal cost.
D)   dump excess supplies of their product on the market.E) B) and D)
F) All of the above

Question 13

Deadweight loss measures the loss in society's welfare that occurs because a monopolist does not produce the socially efficient level of output.

Accepted Answer

A) True 
 B)False

Question 14

Figure 15-8 
-Refer to Figure 15-8.The monopolist's maximum profit

Accepted Answer

A)   is $800.
B)   is $1,000.
C)   is $1,250.
D)   cannot be determined from the diagram.E) A) and B)
F) All of the above

Question 15

Suppose a profit-maximizing monopolist faces a constant marginal cost of $20,produces an output level of 100 units,and charges a price of $50.The socially efficient level of output is 200 units.Assume that the demand curve and marginal revenue curve are the typical downward-sloping straight lines.The monopoly deadweight loss equals $1,500.

Accepted Answer

A) True 
 B)False

Question 16

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 is the total profit if she operates at her profit-maximizing price?

Accepted Answer

A)   $1
B)   $7
C)   $9
D)   $11E) A) and D)
F) C) and D)

Question 17

For a monopoly,the level of output at which marginal revenue equals zero is also the level of output at which

Accepted Answer

A)   average revenue is zero.
B)   profit is maximized.
C)   total revenue is maximized.
D)   marginal cost is zero.E) A) and D)
F) A) and C)

Question 18

Figure 15-1 
-Refer to Figure 15-1.What type of monopoly is shown in the figure?

Accepted Answer

The answer of Figure 15-1 
-Refer to Figure 15-1.What type...

Question 19

When a firm experiences continually declining average total costs,the firm is a

Accepted Answer

A)   natural monopoly.
B)   price taker.
C)   government-created monopoly.
D)   All of the above are correct.E) C) and D)
F) A) and C)

Question 20

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 average revenue when Sally sells 7 pairs of shoes?

Accepted Answer

A)   $40
B)   $90
C)   $100
D)   $700E) B) and C)
F) A) and B)

Exam 15: Monopoly

Deadweight loss measures the loss in society's welfare that occurs because a monopolist does not produce the socially efficient level of output.

Correct Answer
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Table 15-3 Consider the following demand and cost information for a monopoly. -Refer to Table 15-3.The maximum profit this monopolist can earn is

Correct Answer
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Figure 15-11 -Refer to Figure 15-11.Which area represents the deadweight loss from monopoly?

Correct Answer
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When a firm has a natural monopoly,the firm's

Correct Answer
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Correct Answer
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A patent gives a single person or firm the exclusive right to sell some good or service for a specific period of time.

Correct Answer
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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 marginal revenue from selling the 2nd pair of shoes?

Correct Answer
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Monopolies use their market power to

Correct Answer
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Which of the following can eliminate the inefficiency inherent in monopoly pricing?

Correct Answer
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Figure 15-8 -Refer to Figure 15-8.The monopolist's maximum profit

Correct Answer
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The three main sources of barriers to entry are monopoly resources,government regulation,and the firm's production process.

Correct Answer
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Figure 15-1 -Refer to Figure 15-1.What type of monopoly is shown in the figure?

Correct Answer
verified

For a monopoly,the level of output at which marginal revenue equals zero is also the level of output at which

Correct Answer
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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 average revenue when Sally sells 7 pairs of shoes?

Correct Answer
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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 is the total profit if she operates at her profit-maximizing price?

Correct Answer
verified

When a firm experiences continually declining average total costs,the firm is a

Correct Answer
verified

A market force that can prevent firms from price discriminating is

Correct Answer
verified

The difference in total surplus between the socially efficient level of production and the monopolist's level of production is

Correct Answer
verified

The profit that a monopolist earns represents a loss to society that is measured through deadweight loss.

Correct Answer
verified

A rational pricing strategy for a profit-maximizing monopolist is

Correct Answer
verified

Exam 15: Monopoly

Deadweight loss measures the loss in society's welfare that occurs because a monopolist does not produce the socially efficient level of output.

Correct AnswerverifiedShow Answer

Table 15-3 Consider the following demand and cost information for a monopoly. -Refer to Table 15-3.The maximum profit this monopolist can earn is

Correct AnswerverifiedShow Answer

Figure 15-11 -Refer to Figure 15-11.Which area represents the deadweight loss from monopoly?

Correct AnswerverifiedShow Answer

When a firm has a natural monopoly,the firm's

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

A patent gives a single person or firm the exclusive right to sell some good or service for a specific period of time.

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 marginal revenue from selling the 2nd pair of shoes?

Correct AnswerverifiedShow Answer

Monopolies use their market power to

Correct AnswerverifiedShow Answer

Which of the following can eliminate the inefficiency inherent in monopoly pricing?

Correct AnswerverifiedShow Answer

Figure 15-8 -Refer to Figure 15-8.The monopolist's maximum profit

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The three main sources of barriers to entry are monopoly resources,government regulation,and the firm's production process.

Correct AnswerverifiedShow Answer

Figure 15-1 -Refer to Figure 15-1.What type of monopoly is shown in the figure?

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For a monopoly,the level of output at which marginal revenue equals zero is also the level of output at which

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 average revenue when Sally sells 7 pairs of shoes?

Correct AnswerverifiedShow Answer

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 is the total profit if she operates at her profit-maximizing price?

Correct AnswerverifiedShow Answer

When a firm experiences continually declining average total costs,the firm is a

Correct AnswerverifiedShow Answer

A market force that can prevent firms from price discriminating is

Correct AnswerverifiedShow Answer

The difference in total surplus between the socially efficient level of production and the monopolist's level of production is

Correct AnswerverifiedShow Answer

The profit that a monopolist earns represents a loss to society that is measured through deadweight loss.

Correct AnswerverifiedShow Answer

A rational pricing strategy for a profit-maximizing monopolist is

Correct AnswerverifiedShow Answer

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