Econ 101 - Microeconomics » Fall 2022 » Monopoly Ch 8 quiz

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Question #1
Providing medical services for smaller fees to the poor than to the rich is
A.   misplaced charity.
B.   price discrimination.
C.   social pricing.
D.   benevolent pricing.
Question #2
Pure monopoly is defined as a
A.   one-firm industry.
B.   market structure maintained by entry of many rival firms.
C.   market structure in which there are many substitute products.
D.   market structure created by special government sanctions.
Question #3
A profit-maximizing monopolist sets
A.   her product's price where MC = MR.
B.   All of the choices are correct
C.   her output where MC = MR.
D.   None of the choices are correct
Question #4
The marginal revenue curve for a monopolist is
A.   generally below the average cost curve.
B.   always below the demand curve.
C.   always above the average revenue curve.
D.   always above the demand curve.
Question #5
Which of the following is not potentially a barrier to entry into the widget market?
A.   patent protection on the design of widgets
B.   high prices for widgets
C.   government licensing of widget producers
D.   massive advertising by existing widget producers
Question #6
The key element in preserving a monopoly is
A.   guaranteeing availability of substitute products.
B.   government subsidy of critical enterprises.
C.   keeping potential rivals out of the market.
D.   increased advertising expenditure.
Question #7
A monopolist is best described as a price
A.   searcher.
B.   maker.
C.   follower.
D.   taker.
Question #8
Compared to a perfectly competitive firm, a monopolist
A.   is less likely to face government regulation.
B.   will, according to Schumpeter, invest fewer resources in research and development.
C.   is less likely to advertise.
D.   usually produces an inefficiently small level of output.
Question #9
What is true for monopoly that is not true for perfect competition?
A.   The industry demand curve is downward sloping.
B.   Profit is maximized where MR = MC.
C.   The firm and the industry are exactly the same entity.
D.   Positive economic profits may be earned in the short run.
Question #10
A monopolist can sell 10 wangdoodles if he charges $10 per wangdoodle and 11 wangdoodles if he charges $9. The MR from selling the 11th wangdoodle is
A.   -$1.
B.   $9.
C.   $1.
D.   $99.
Question #11
The South African diamond production monopoly is an example of monopoly through
A.   control of scarce resources.
B.   legal restriction.
C.   "patent power."
D.   large sunk costs.
Question #12
To be a natural monopoly, a firm must
A.   control an essential natural resource input.
B.   be very large.
C.   have a continuously falling average cost curve as output rises.
D.   have falling average costs over a substantial range of total market demand.
Question #13
The demand curve facing a monopolist is
A.   identical to the market demand curve for the good.
B.   exactly twice as steep as the market demand curve for the good.
C.   perfectly inelastic at the market price.
D.   horizontal at the market price.

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