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.   benevolent pricing.
B.   social pricing.
C.   misplaced charity.
D.   price discrimination.
Question #2
Pure monopoly is defined as a
A.   market structure in which there are many substitute products.
B.   market structure maintained by entry of many rival firms.
C.   one-firm industry.
D.   market structure created by special government sanctions.
Question #3
A profit-maximizing monopolist sets
A.   All of the choices are correct
B.   her product's price where MC = MR.
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.   massive advertising by existing widget producers
B.   high prices for widgets
C.   patent protection on the design of widgets
D.   government licensing of widget producers
Question #6
The key element in preserving a monopoly is
A.   guaranteeing availability of substitute products.
B.   increased advertising expenditure.
C.   government subsidy of critical enterprises.
D.   keeping potential rivals out of the market.
Question #7
A monopolist is best described as a price
A.   maker.
B.   searcher.
C.   follower.
D.   taker.
Question #8
Compared to a perfectly competitive firm, a monopolist
A.   usually produces an inefficiently small level of output.
B.   will, according to Schumpeter, invest fewer resources in research and development.
C.   is less likely to advertise.
D.   is less likely to face government regulation.
Question #9
What is true for monopoly that is not true for perfect competition?
A.   Positive economic profits may be earned in the short run.
B.   The industry demand curve is downward sloping.
C.   Profit is maximized where MR = MC.
D.   The firm and the industry are exactly the same entity.
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.   $99.
B.   -$1.
C.   $9.
D.   $1.
Question #11
The South African diamond production monopoly is an example of monopoly through
A.   "patent power."
B.   large sunk costs.
C.   legal restriction.
D.   control of scarce resources.
Question #12
To be a natural monopoly, a firm must
A.   control an essential natural resource input.
B.   have falling average costs over a substantial range of total market demand.
C.   have a continuously falling average cost curve as output rises.
D.   be very large.
Question #13
The demand curve facing a monopolist is
A.   exactly twice as steep as the market demand curve for the good.
B.   identical to the market demand curve for the good.
C.   horizontal at the market price.
D.   perfectly inelastic at the market price.

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