Quiz Questions - Foo and Res. Econ. Ch. 16

In the preceding figure, what is the level of profit for the firm operating in a monopoly environment at the profit maximizing level of production

$280

In the preceding figure, what is the monopolist firm's total costs at the profit maximizing level of production?

$700

In the preceding figure, how may units will the monopolist firm produce in order to maximize profit?

70

Which of the following would be most likely to have monopoly power?

A local cable TV provider

Monopolies are inefficient because the price they charge is

Above marginal cost

Which of the following is not an example of a barrier to entry?

An entrepreneur opens a popular new hair studio

The fundamental source of monopoly power is

Barriers to entry

If a firm is operating in a monopoly market, then which of the following is true?

Buyers are price makers and the seller is a price makers.

For a firm to price discriminate,

It must have some market power.

The profit maximizing monopolist will produce at the point where

Marginal revenue equals marginal cost

If the distribution of water is a natural monopoly, then

Multiple firms would likely each have to pay large fixed costs to develop their own network of pipes

The deadweight loss associated with a monopoly occurs because the monopolist

Produces an output level less than the socially optimal level

Bob's Bucher Shop is the only place within 250 miles that sells bison burgers. Assuming that Bob is a monopolist and maximizing his profit, which of the following statements is true?

The price of Bob's bison burgers will exceed Bob's marginal cost.