MICRO 13-17
Which of the following is not an example of price discrimination?
An icecream parlor charges a higher price for ice-cream than sherbet
Which of the following is correct?
Assuming that implicit costs are positive, accounting profit is greater than economic profit.
Which of the following is not an example of price discrimination by a firm?
a natural gas company charging customers a higher rate in the winter than in the summer
When a single firm can supply a product to an entire market at a lower cost than could two or more firms, the industry is called a
natural monopoly
In a perfectly competitive market
no one seller can influence the price of the product
The story of a prisoners' dilemma shows why
oligopolies can fail to cooperate, even when cooperation is in their best interest.
A firm cannot price discrimination if it
operates in a competetive market.
For a monopolistically competitive firm, at the profit-maximizing quantity of output
price exceeds marginal costs
imperfectly competitive firms are characterized by
price making ability
Which of the following expressions is correct?
Accounting profit= total revenue-explicit costs
Which of the following statements is not correct?
Both monopolies and monopolistically competitive firms can earn economic profits in the long run.
Which of the following is not a reason for the existence of a monopoly?
Diseconomies of scale
Which of the following is not a characteristic of a competitive market?
Entry is limited
Which of the following is not a characteristic of a monopoly?
One buyer
Which of the following conditions is characteristic of a monopolistically competitive firm in both the short-run and the long run?
P> MC
To maximize its profit, a monopolist would choose which of the following outcomes?
Q=30 and P=60
Foregone investment opportunities are an example of
an implicit cost
The value of a business owner's time is an example of
an opportunity cost
Fixed costs can be defined as costs that
are incurred even if nothing is produced
A monopolistically competitive market has characteristics that are similar to
both a monopoly and a competitive firm
The lower the concentration ratio, the
more competitive the industry
In a two-person repeated game, a tit-for-tat strategy starts with
cooperation and then each player mimics the other player's last move
In an oligopoly each firm knows that its profits
depend on both how much output it produces and how much output its rival firms produce.
A firm's opportunity costs of production are equal to its
explicit costs + implicit costs
Which of the following is a characteristic of monopolistic competition?
free entry
A benefit of a monopoly is
greater creativity by authors who can copyright their novels
A production function describes
how a firm turns inputs into output
in general, game theory is the study of
how people behave in strategic situations
A particular cable TV company requires a household to subscribe to its high-speed internet service if it subscribes to cable TV, and vice versa. This practice
is referred to as tying, is regarded by some economists as a form of price discrimination, is controversial among con omits because they disagree on whether it has adverse effects for society as a whole.
A monopolist produces
less than the socially efficient quantity of output but at a higher price than in a competitive market
If firms are competitive and profit maximizing, the price of a good equals the
marginal cost of production
When a firm's only variable input is labor, then the slope of the production function measures the
marginal product of labor
The deadweight loss that arises from a monopoly is a consequence of the fact that the monopoly
quantity is lower than the socially-optimal quantity
Price discrimination is the business practice of
selling the same good at different prices to difference customers
Price discrimination requires the firm to
separate customers according to their willingness to pay
The long-run supply curve for a competitive industry may be upward sloping if
some resources are available only in limited quantities
Which of the following may eliminate some or all of the efficiency that results from monopoly pricing?
the government can regulate the monopoly
An example of an opportunity cost that is also an implicit cost is
the value of the business owner's time
The paradoxical nature of oligopoly can be demonstrated by the fact that, even though the monopoly outcome is best for the oligopolists,
they have incentives to increase production above the monopoly outcome.
Which of the following can be added to profit to obtain total revenue?
total cost
Economic profit
will never exceed accounting profit