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.   benevolent pricing.
C.   social pricing.
D.   price discrimination.
Question #2
Pure monopoly is defined as a
A.   one-firm industry.
B.   market structure in which there are many substitute products.
C.   market structure maintained by entry of many rival firms.
D.   market structure created by special government sanctions.
Question #3
A profit-maximizing monopolist sets
A.   None of the choices are correct
B.   her output where MC = MR.
C.   her product's price where MC = MR.
D.   All of the choices are correct
Question #4
The marginal revenue curve for a monopolist is
A.   always below the demand curve.
B.   generally below the average cost 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.   high prices for widgets
B.   government licensing of widget producers
C.   massive advertising by existing widget producers
D.   patent protection on the design of widgets
Question #6
The key element in preserving a monopoly is
A.   guaranteeing availability of substitute products.
B.   keeping potential rivals out of the market.
C.   increased advertising expenditure.
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 face government regulation.
C.   usually produces an inefficiently small level of output.
D.   is less likely to advertise.
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.   Profit is maximized where MR = MC.
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.   $9.
C.   -$1.
D.   $99.
Question #11
The South African diamond production monopoly is an example of monopoly through
A.   legal restriction.
B.   large sunk costs.
C.   "patent power."
D.   control of scarce resources.
Question #12
To be a natural monopoly, a firm must
A.   have a continuously falling average cost curve as output rises.
B.   be very large.
C.   have falling average costs over a substantial range of total market demand.
D.   control an essential natural resource input.
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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