Graphs for monopoly
false
A monopolist, being the sole seller in a market, is assured of positive economic profits. true or false
ATC
A monopoly results in productive inefficiency because at the profit-maximizing output level: _______ is not at its minimum level
False
A patent for a new product or a new business process is typically granted for a hundred years. true or false
variable cost
A profit-maximizing firm should shut down in the short run if the average revenue it receives is less than: Average ______ _____
Patent
An exclusive legal right as sole producer for 20 years granted to an inventor of a product is called a:
one
Assume that a monopolist faces a linear demand curve and that it produces the output quantity where total revenue is maximized. At that output, the price elasticity of demand for the product is: Equal to ______
elastic demand
Assume that a monopolist faces a linear demand curve. If the firm is operating at an output level where marginal revenue is positive, the firm: Is operating on the ______ portion of its ______ curve
Rent-seeking
Assume that the owners of the only gambling casino in Wisconsin spend large sums of money lobbying state government officials to protect their gambling monopoly. Economists refer to these expenditures as:
profit
At equilibrium, the profit-maximizing monopolist facing the situation shown in the graph will face a negative:
False
At the inelastic portion of a monopolist's demand curve, the marginal revenue of each extra unit of output is positive. true or false
government
Barriers to entry: Can result from _______ regulation
consumer loyalty
Google gained its monopoly power in the market for internet-search service because it: Was first to market and gained ______ _____
elastic x y
If a price-discriminating monopolist sells the same product in two markets but charges a higher price in market X and a lower price in market Y, the pricing difference indicates that demand is: Less ____ in market _ than market _
true
In a monopoly at equilibrium, price is greater than marginal cost. true or false
Licenses
In many large U.S. cities, taxicab companies operate as near monopolies because of:
p3
In most cases, a monopolist practicing price discrimination will end up earning less economic profits than a non-discriminating monopolist.
false
In most cases, a monopolist practicing price discrimination will end up earning less economic profits than a non-discriminating monopolist. true or false
positive zero
In the short run equilibrium, a monopolist's profits: May be ______ , negative, or _____
maximizing
Many economists agree that government should deal with monopolists on a case-by-case basis. Policy options include the following, except: If the monopoly is _______ economic profits, the government should subsidize new firms to enter the industry
sheltered
Monopoly firms are ________ from competitive forces and such an environment makes them subject to X-inefficiency
Monopoly
Network effects and simultaneous consumption tend to foster the development of: _________ power
greater
One argument for having the government regulate natural monopolies is that without regulation: These monopolies produce at a level where marginal benefit is ______ than marginal cost
essential
One major barrier to entry under pure monopoly arises from: Ownership of ______ resources
monopolists
Pure _____ do not always realize positive profits, sometimes they suffer losses
price greater
Pure monopolists: Operate where ___ is ___ then MC
0ADQ
Refer to the above graph for a monopolist in short-run equilibrium. This monopolist has total cost equal to area:
0B
Refer to the above graph for a monopolist in short-run equilibrium. This monopolist will charge a price:
loss DE
Refer to the above graph for a monopolist in short-run equilibrium. This monopolist: Has a _____ per unit equal to _____
Positive
Refer to the above graph for a profit-maximizing monopolist. At equilibrium, the firm will be earning: _______ profits
0V
Refer to the above graph for a profit-maximizing monopolist. The firm will produce the quantity:
profit-maximizing
Refer to the above graph for a pure monopoly. If the government regulated the monopoly and made it charge the socially optimal price, this price would be: Lower than both the fair-return price and the ______ - ______ price
P2 Q3
Refer to the above graph for a pure monopoly. If the government regulated the monopoly and made it produce the level of output that would achieve allocative efficiency, what price and quantity levels would we observe in the short run? ___ and ____
P3 and Q2
Refer to the above graph for a pure monopoly. If the government regulated the monopoly and made the firm set a fair-return price, what price and quantity levels would we observe in the short run?
greater
Refer to the above graph showing a linear demand curve for a monopolist. Which of the following statements is correct? The area 0QVS is ______ than the area 0RWT
rising
Refer to the above graph. The profit-maximizing firm will produce in that output level where total revenue is:
elastic
Refer to the above graphs of D and MR for a monopolist. Which of the following statements is true? Demand is _______ at a price of P1
90
Refer to the graph above for an industry. If the industry operates as a pure monopoly, the output quantity would be:
14
Refer to the graph above for an industry. If the industry were purely competitive, the market price would be:
Decreasing output
Suppose that a monopolist calculates that at its present output level, marginal cost is $4.00 and marginal revenue is $5.00. The firm could increase profits by: ______ price and increasing _________
Increasing decreasing
Suppose that a monopolist calculates that at present its output level, marginal revenue is $1.00 and marginal cost is $2.00. He or she could maximize profits or minimize losses by: ________ price and _______ output
Wham-O
The classic example of a private unregulated monopoly is: (Frisbee)
Downsloping
The following graph shows a total revenue curve for a monopolist. Refer to the above graph. The firm's marginal revenue curve must be:
Inelastic
The following graph shows a total revenue curve for a monopolist. Refer to the above graph. When total revenue declines as output expands, demand is:
$250
The following question is based on the demand and cost data for a pure monopolist given in the table below. Refer to the above table for a monopolist. A non-discriminating monopolist would earn maximum profits of:
150
The following question is based on the demand and cost data for a pure monopolist given in the table below. Refer to the above table. If the monopolist were forced to produce the socially optimal output through the imposition of a ceiling price, the ceiling price would have to be set at: $_____
$400
The following question is based on the demand and cost data for a pure monopolist given in the table below. Refer to the above table for a monopolist. If the monopolist perfectly price-discriminated and sold each unit of the product at the maximum price the buyer of that unit would be willing to pay, and if the monopolist sold 4 units, then total profits would be:
< ATC
The problem with socially-optimal pricing regulation of a natural monopoly is that: P _ ____
false
The supply curve for a monopolist is the upward-sloping portion of the marginal cost curve that lies above the average variable cost curve. true or false
Not clearly defined
The supply curve for a monopoly is:
30
The table shows the demand schedule facing Nina, a monopolist selling baskets. Refer to the above table for Nina. What is the change in total revenue if she lowers the price from $20 to $18?
elasticities
To practice long-run price discrimination, a monopolist must: Be able to separate buyers into different markets with different price _______
marginal cost greater
Under which of the following conditions would a profit-maximizing monopolist necessarily raise price? If ____ ____ was _______ than marginal revenue
optimal price allocative
What is the meaning of the phrase "dilemma of regulation"? The socially ____ _____ achieves _______ efficiency, but may produce economic losses; the fair return price yields a normal profit but may not be allocatively efficient
Less price
When compared with the purely competitive industry with identical costs of production, a monopolist will produce: ______ output and charge a higher ______
b
Which of the above shows the correct relationship between demand and marginal revenue?
The firm will charge the highest price possible
Which of the following does not necessarily apply to a pure monopoly? The product the firm produces must have no close substitutes The firm must be the sole producer of a product The firm will charge the highest price possible Entry must be blocked
average cost cost
With non-rivalrous consumption such as in the case of online music and movies, as more consumers buy the product: The _____ ____ of the output declines because the marginal _____ is very small
lower prices
best represents a case of price discrimination A major airline sells tickets to senior citizens at ___ ____ than to other passengers
lower rates
example of price discrimination A telephone company charging ___ ____ to weekend users than weekday users