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Which would be defining characteristics of pure monopoly?
A)The firm does no advertising and it sells a standardized product.
B)No close substitutes for the product exist and there is one seller.
C)The firm can easily enter into or exit from the industry and profits are guaranteed.
D)The firm holds a patent and is technologically progressive.
The demand curve for the pure monopolist is
A)perfectly price elastic
B)perfectly price inelastic
C)Downward sloping
D)Upward sloping
When the monopolist is maximizing total profits or minimizing losses,
A)total revenue is greater than total cost
B)average revenue is greater than average total cost
C)average revenue is greater than marginal cost
D)average total cost is less than marginal cost
At which of the following combinations of price and marginal revenue is the price elasticity of demand less than 1?
A)Price equals $102, marginal revenue equals $42.
B)Price equals $92, marginal revenue equals $22.
C)Price equals $82, marginal revenue equals $2.
D)Price equals $72, marginal revenue equals -$18.
At the present level of output a monopolist determines that its marginal cost is $18 (and on the rising portion of the curve), and its marginal revenue is $21. The monopolist will maximize profits or minimize losses by
A)increasing price while keeping output constant
B)decreasing price and increasing output
C)decreasing both price and output
D)increasing both price and output
The supply curve for a pure monopolist
A)is the portion of the marginal cost curve that lies above the average variable cost curve
B)is perfectly price elastic at the market price
C)is upward sloping
D)does not exist
The analysis of monopoly indicates that the monopolist
A)will charge the highest price it can get
B)will seek to maximize total profits
C)is guaranteed an economic profit
D)is only interested in normal profit
At the equilibrium level of output, a monopolist does not produce the product as efficiently as is possible because
A)the average total cost of producing it is not a minimum
B)the marginal cost of producing the last unit is less than its price
C)it is earning a profit
D)average revenue is greater than the cost of producing an extra unit of output
Which will tend to increase the inefficiencies of the monopoly producer?
A)price-taking behavior
B)rent-seeking behavior
C)economies of scale
D)technological progress

This diagram is for a non-discriminating monopolist. At output Q the firm will
A)Charge a price of 0C.
B)Take a loss of BKJFA.
C)Make a profit of ABFG.
D)Charge a price of 0B.

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