Question 1

Figure 15-1 
-Refer to Figure 15-1. If the monopolist uses perfect price discrimination, how much output does the firm produce?

Accepted Answer

The answer of Figure 15-1 
-Refer to Figure 15-1. If...

Question 2

Scenario 15-6
The concert promoters of a heavy-metal band, WeR2Loud, know that there are two types of concert-goers: die-hard fans and casual fans. For a particular WeR2Loud concert, there are 1,000 die-hard fans who will pay $150 for a ticket and 500 casual fans who will pay $50 for a ticket. There are 1,500 seats available at the concert venue. Suppose the cost of putting on the concert is $50,000, which includes the cost of the band, lighting, security, etc.
-Refer to Scenario 15-6. How much additional profit can the concert promoters earn by charging each customer their willingness to pay relative to charging a flat price of $50 per ticket?

Accepted Answer

A)  $25,000
B)  $50,000
C)  $75,000
D)  $100,000E) A) and D)
F) A) and C)

Question 3

Price discrimination

Accepted Answer

A)  forces monopolies to charge a lower price as a result of government regulation.
B)  is an attempt by a monopoly to prevent some customers from purchasing its product by charging a high price.
C)  is an attempt by a monopoly to increases its profit by selling the same good to different customers at different prices.
D)  increases the consumer surplus associated with a monopolistic market.E) C) and D)
F) A) and B)

Question 4

Which of the following is a characteristic of a natural monopoly?

Accepted Answer

A)  Fixed costs are typically a small portion of total costs.
B)  Average total cost declines over large regions of output.
C)  The product sold is a natural resource such as diamonds or water.
D)  All of the above are correct.E) All of the above
F) B) and C)

Question 5

Table 15-13
The following table gives information on the price, quantity, and total cost of production for a monopolist. 
-Refer to Table 15-13. How much profit will the firm earn at the profit-maximizing price?

Accepted Answer

A)  $9
B)  $12
C)  $15
D)  $18E) All of the above
F) B) and C)

Question 6

Table 15-4
A monopolist faces the following demand curve: 
-Refer to Table 15-4. If the monopolist produces 10 units, what is its average revenue?

Accepted Answer

A)  $100
B)  $15
C)  $10
D)  $1E) A) and B)
F) A) and C)

Question 7

For a monopoly, the socially efficient level of output occurs where

Accepted Answer

A)  marginal revenue equals marginal cost.
B)  average revenue equals marginal cost.
C)  marginal revenue equals average total cost.
D)  average revenue equals average total cost.E) B) and D)
F) None of the above

Question 8

When a monopolist increases the amount of output that it produces and sells, average revenue

Accepted Answer

A)  increases, and marginal revenue increases.
B)  increases, and marginal revenue decreases.
C)  decreases, and marginal revenue increases.
D)  decreases, and marginal revenue decreases.E) A) and B)
F) A) and C)

Question 9

Table 15-19
A monopolist faces the following demand curve: 
-Refer to Table 15-19. If a monopolist faces a constant marginal cost of $3, how much output should the firm produce?

Accepted Answer

A)  3 units
B)  4 units
C)  5 units
D)  6 unitsE) A) and B)
F) A) and C)

Question 10

Table 15-19
A monopolist faces the following demand curve: 
-Refer to Table 15-19. If a monopolist faces a constant marginal cost of $5, how much output should the firm produce in order to equate marginal revenue with marginal cost?

Accepted Answer

A)  3 units
B)  4 units
C)  5 units
D)  6 unitsE) A) and B)
F) A) and C)

Question 11

A monopolist does not have a supply curve because the firm's decision about how much to supply is impossible to separate from the demand curve it faces.

Accepted Answer

A) True 
 B)False

Question 12

Table 15-6
A monopolist faces the following demand curve: 
-Refer to Table 15-6. If the monopolist has a constant marginal cost for her product equal to $7, what is her profit-maximizing price?

Accepted Answer

A)  $6
B)  $9
C)  $12
D)  $15E) All of the above
F) A) and B)

Question 13

The fundamental cause of monopoly is

Accepted Answer

The answer of The fundamental cause of monopoly is...

Question 14

Figure 15-18 
-Refer to Figure 15-18. If the monopoly firm perfectly price discriminates, then the deadweight loss amounts to

Accepted Answer

A)  $0.
B)  $1,000.
C)  $2,000.
D)  $4,000.E) B) and D)
F) A) and B)

Question 15

Scenario 15-2
Consider a local, privately-owned electrical cooperative named Poweshiek Power Company (PPCo) . PPCo has just completed a clean-coal-burning electrical power plant in Iowa. Currently, PPCo can meet the electricity needs of all residents in the county. In fact, its capacity far exceeds the needs of the county. After just a few years of operation, the shareholders of PPCo experienced incredibly high rates of return on their investment due to the profitability of the corporation.
-Refer to Scenario 15-2. Which of the following statements is most likely to be true?
(i) New entrants to the market know they will have a smaller market share than PPCo currently has.
(ii) PPCo is a natural monopoly.
(iii) PPCo would experience higher profits if it were government-run.

Accepted Answer

A)  (i)  and (ii)  only
B)  (ii)  and (iii)  only
C)  (i)  and (iii)  only
D)  (i) , (ii) , and (iii) E) B) and C)
F) A) and D)

Question 16

Since a monopolist faces a downward sloping demand curve,

Accepted Answer

A)  ​the monopolist is able to sell all that it wants at whatever price the monopolist chooses.
B)  ​it is necessary for the monopolist to lower the price to sell additional units of the good.
C)  ​the monopolist sells only a fraction of the total sales of the good in the market.
D)  ​the monopolist must always make an economic profit.E) All of the above
F) A) and B)

Question 17

If a monopolist sells 100 units at $8 per unit and realizes an average total cost of $6 per unit, what is the monopolist's profit?

Accepted Answer

A)  $200
B)  $400
C)  $600
D)  $800E) A) and C)
F) None of the above

Question 18

Economists assume that monopolists behave as

Accepted Answer

A)  cost minimizers.
B)  profit maximizers.
C)  price maximizers.
D)  maximizers of social welfare.E) A) and D)
F) All of the above

Question 19

Which of the following is an example of price discrimination?

Accepted Answer

A)  Nabisco provides cents-off coupons for its products.
B)  Amtrak offers a lower price for weekend travel compared to weekday rates on the same routes.
C)  Hotel rates for AAA members are lower than for nonmembers.
D)  All of the above are correct.E) C) and D)
F) B) and C)

Question 20

Which of the following statements is correct?

Accepted Answer

A)  The demand curve facing a competitive firm is horizontal, as is the demand curve facing a monopolist.
B)  The demand curve facing a competitive firm is downward sloping, whereas the demand curve facing a monopolist is horizontal.
C)  The demand curve facing a competitive firm is horizontal, whereas the demand curve facing a monopolist is downward sloping.
D)  The demand curve facing a competitive firm is downward sloping, as is the demand curve facing a monopolist.E) C) and D)
F) B) and D)

Exam 15: Monopoly

Table 15-6 A monopolist faces the following demand curve: -Refer to Table 15-6. If the monopolist has a constant marginal cost for her product equal to $7, what is her profit-maximizing price?

Correct Answer
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For a monopoly, the socially efficient level of output occurs where

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Figure 15-1 -Refer to Figure 15-1. If the monopolist uses perfect price discrimination, how much output does the firm produce?

Correct Answer
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The fundamental cause of monopoly is

Correct Answer
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When a monopolist increases the amount of output that it produces and sells, average revenue

Correct Answer
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Since a monopolist faces a downward sloping demand curve,

Correct Answer
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Economists assume that monopolists behave as

Correct Answer
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Which of the following statements is correct?

Correct Answer
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Figure 15-18 -Refer to Figure 15-18. If the monopoly firm perfectly price discriminates, then the deadweight loss amounts to

Correct Answer
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Which of the following is a characteristic of a natural monopoly?

Correct Answer
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Price discrimination

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Table 15-4 A monopolist faces the following demand curve: -Refer to Table 15-4. If the monopolist produces 10 units, what is its average revenue?

Correct Answer
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Table 15-19 A monopolist faces the following demand curve: -Refer to Table 15-19. If a monopolist faces a constant marginal cost of $5, how much output should the firm produce in order to equate marginal revenue with marginal cost?

Correct Answer
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If a monopolist sells 100 units at $8 per unit and realizes an average total cost of $6 per unit, what is the monopolist's profit?

Correct Answer
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A monopolist does not have a supply curve because the firm's decision about how much to supply is impossible to separate from the demand curve it faces.

Correct Answer
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Table 15-13 The following table gives information on the price, quantity, and total cost of production for a monopolist. -Refer to Table 15-13. How much profit will the firm earn at the profit-maximizing price?

Correct Answer
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Table 15-19 A monopolist faces the following demand curve: -Refer to Table 15-19. If a monopolist faces a constant marginal cost of $3, how much output should the firm produce?

Correct Answer
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Which of the following is an example of price discrimination?

Correct Answer
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Exam 15: Monopoly

Table 15-6 A monopolist faces the following demand curve: -Refer to Table 15-6. If the monopolist has a constant marginal cost for her product equal to $7, what is her profit-maximizing price?

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For a monopoly, the socially efficient level of output occurs where

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Figure 15-1 -Refer to Figure 15-1. If the monopolist uses perfect price discrimination, how much output does the firm produce?

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The fundamental cause of monopoly is

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When a monopolist increases the amount of output that it produces and sells, average revenue

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Since a monopolist faces a downward sloping demand curve,

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Economists assume that monopolists behave as

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Which of the following statements is correct?

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Figure 15-18 -Refer to Figure 15-18. If the monopoly firm perfectly price discriminates, then the deadweight loss amounts to

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Which of the following is a characteristic of a natural monopoly?

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Price discrimination

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Table 15-4 A monopolist faces the following demand curve: -Refer to Table 15-4. If the monopolist produces 10 units, what is its average revenue?

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Table 15-19 A monopolist faces the following demand curve: -Refer to Table 15-19. If a monopolist faces a constant marginal cost of $5, how much output should the firm produce in order to equate marginal revenue with marginal cost?

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If a monopolist sells 100 units at $8 per unit and realizes an average total cost of $6 per unit, what is the monopolist's profit?

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A monopolist does not have a supply curve because the firm's decision about how much to supply is impossible to separate from the demand curve it faces.

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Table 15-13 The following table gives information on the price, quantity, and total cost of production for a monopolist. -Refer to Table 15-13. How much profit will the firm earn at the profit-maximizing price?

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Table 15-19 A monopolist faces the following demand curve: -Refer to Table 15-19. If a monopolist faces a constant marginal cost of $3, how much output should the firm produce?

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Which of the following is an example of price discrimination?

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