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

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