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.   social pricing.
C.   benevolent pricing.
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.   always above the average revenue curve.
B.   always above the demand curve.
C.   generally below the average cost curve.
D.   always below the demand curve.
Question #5
Which of the following is not potentially a barrier to entry into the widget market?
A.   government licensing of widget producers
B.   high prices for widgets
C.   patent protection on the design of widgets
D.   massive advertising by existing widget producers
Question #6
The key element in preserving a monopoly is
A.   keeping potential rivals out of the market.
B.   increased advertising expenditure.
C.   government subsidy of critical enterprises.
D.   guaranteeing availability of substitute products.
Question #7
A monopolist is best described as a price
A.   searcher.
B.   maker.
C.   taker.
D.   follower.
Question #8
Compared to a perfectly competitive firm, a monopolist
A.   is less likely to advertise.
B.   is less likely to face government regulation.
C.   usually produces an inefficiently small level of output.
D.   will, according to Schumpeter, invest fewer resources in research and development.
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.   $9.
B.   -$1.
C.   $99.
D.   $1.
Question #11
The South African diamond production monopoly is an example of monopoly through
A.   large sunk costs.
B.   control of scarce resources.
C.   "patent power."
D.   legal restriction.
Question #12
To be a natural monopoly, a firm must
A.   have a continuously falling average cost curve as output rises.
B.   have falling average costs over a substantial range of total market demand.
C.   control an essential natural resource input.
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.   horizontal at the market price.
C.   identical to the market demand curve for the good.
D.   perfectly inelastic at the market price.

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