 |
| 1 | |
At a monopolist's current output, ATC = $10, P = $11, MC = $8 and MR = $7. This firm is realizing: |
| | A) | an economic profit that could be increased by producing more output |
| | B) | an economic profit that could be increased by producing less output |
| | C) | an economic loss that could be increased by producing more output |
| | D) | an economic loss than could be increased by producing less output |
|
|
|
| 2 | |
Use the following diagram to answer the next question.
 <![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/1113273090/384259/quiz22a_2.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (4.0K)</a>]]>
Refer to the diagram. At output q2: |
| | A) | marginal revenue exceeds marginal cost by the greatest amount |
| | B) | demand is inelastic |
| | C) | profit is maximized |
| | D) | marginal revenue is zero |
|
|
|
| 3 | |
A pure monopolist is selling 8 units at a price of $50. If the marginal revenue of the ninth unit is $23, then: |
| | A) | the price of the ninth unit is $23 |
| | B) | the price of the ninth unit is $47 |
| | C) | the price of the ninth unit is $52 |
| | D) | the firm's demand curve is inelastic at a price of $50 |
|
|
|
| 4 | |
In long run equilibrium, both a competitive firm and a monopolistic firm: |
| | A) | earn zero economic profits |
| | B) | set price equal to marginal revenue |
| | C) | produce at minimum average total cost |
| | D) | produce the output at which marginal revenue equals marginal cost |
|
|
|
| 5 | |
Use the following diagram to answer the next question:
 <![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/1113273090/384259/quiz22a_5.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (8.0K)</a>]]>
Refer to the diagram. This nondiscriminating monopolist will produce: |
| | A) | M units at price A and make a profit |
| | B) | N units at price B and earn zero profits |
| | C) | M units at price C and incur a loss |
| | D) | Q units at price J and earn zero profits |
|
|
|
| 6 | |
Use the following diagram to answer the next question:
 <![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/1113273090/384259/quiz22a_6.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (8.0K)</a>]]>
Refer to the diagram. If this firm produces its profit-maximizing output, its potential profit is: |
| | A) | zero |
| | B) | area AFHC |
| | C) | area AFGB |
| | D) | area BGHC |
|
|
|
| 7 | |
A profit-maximizing, nondiscriminating monopolist will set its price: |
| | A) | equal to minimum average total cost |
| | B) | so as to maximize profit per unit |
| | C) | on the inelastic portion of its demand curve |
| | D) | so as to equate marginal revenue and marginal cost |
|
|
|
| 8 | |
A profit-maximizing, nondiscriminating monopolist is currently charging a price of $79 for its output. Its marginal revenue: |
| | A) | is less than $79 |
| | B) | is more than $79 |
| | C) | is equal to $79 |
| | D) | any of the above are possible |
|
|
|
| 9 | |
Use the following diagram to answer the next question.
 <![CDATA[<a onClick="window.open('/olcweb/cgi/pluginpop.cgi?it=jpg::::/sites/dl/free/1113273090/384259/quiz22a_9.jpg','popWin', 'width=NaN,height=NaN,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (8.0K)</a>]]>
Refer to the diagram. If this profit-maximizing monopolist is currently producing output Q3 at average total cost equal to P3, then this firm: |
| | A) | could increase its profit by lowering its price |
| | B) | is being regulated |
| | C) | is engaging in price discrimination |
| | D) | is a natural monopoly |
|
|
|
| 10 | |
Suppose a monopolist could segment its market into two distinct submarkets and prevent resale between them. Its profits would increase if it charged a higher price to the group whose: |
| | A) | demand is more elastic |
| | B) | demand is more inelastic |
| | C) | demand is greater |
| | D) | cost is lower |
|
|
.