Econ 101 Chapter 15-16 tophat

3,000; $70

The figure above shows the demand, marginal revenue, and marginal cost curves for Paul's Parrot pillows, a monopoly producer of pillows stuffed with parrot feathers. When Paul maximizes his profit, Paul produces ________ pillows per hour, and charges a price of ____ per pillow.

4 and 5

The table above gives the demand for a monopolist's output. Between which two quantities is marginal revenue equal to 0?

both b & c

A monopoly a. is not protected by barriers to entry b. produces a good with no close substitues c. faces a downward-sloping demand curve d. all of the above e. both b & c

with no close substitutes; are

A monopoly produces a product ________ and there ________ barriers to entry into the market.

one firm can supply an entire market at a lower average total cost than can two or more firms

A natural monopoly exists when

sells a product that has perfect substitutes

A perfectly competitive firm

$34

A single-price monopoly can sell 10 units of its product at a price of $45 each but to sell 11 units, the monopoly must cut the price to $44. What is the marginal revenue of the extra unit sold?

$18

Suppose a single-price monopoly sells 3 units of a good at $20 per unit. If the monopoly sells 4 units, the total revenue increases to $78. What is the marginal revenue of the fourth unit?

produce more than 30 units and less than 40 units

The above figure illustrates a perfectly competitive firm. If the market price is $25 a unit, to maximize its profit (or minimize its loss) the firm should

produce 40 units

The above figure illustrates a perfectly competitive firm. If the market price is $40 a unit, to maximize its profit (or minimize its loss) the firm should

will stay open to produce and will incur an economic loss

The above figure shows a perfectly competitive firm. If the market price is $15 per unit, the firm

$165

The above figure shows a perfectly competitive firm. If the market price is $15, the firm incurs an economic profit/loss equal to:

will stay open to produce and will make zero economic profit

The above figure shows a perfectly competitive firm. If the market price is $20 per unit, the firm

$680

The above figure shows a perfectly competitive firm. If the market price is $40, the firm incurs an economic profit/loss equal to:

firms enter and the market price declines

The above figure shows a perfectly competitive firm. If the market price is $40, we expect the following to happen in the long run:

it will shutdown in the short run and incur a loss equal to its fixed costs.

The above figure shows a perfectly competitive firm. If the market price is $5, the firm incurs an economic profit/loss equal to:

firms exit and the market price increases

The above figure shows a perfectly competitive firm. If the market price is $5, we expect the following to happen in the long run

will stay open to produce and will make an economic profit

The above figure shows a perfectly competitive firm. If the market price is more than $20 per unit, the firm

5

The above table has the total revenue and total cost schedule for Omar, a perfectly competitive grower of rutabagas. Omar's total profit is maximized when he produces ________ bushels of rutabagas.

-$8

The above table has the total revenue and total cost schedule for Omar, a perfectly competitive grower of rutabagas. When Omar produces 2 bushels of rutabagas, his total profit equals

abf; ace

The amount of consumer surplus when the market has a monopoly producer is ________ and the amount of consumer surplus when the market is perfectly competitive is ________.

bcd

The deadweight loss when the market has a monopoly producer is

$6 and $4

The table gives the demand schedule for a monopoly. The demand is elastic at all prices between

what quantity of output to produce.

To maximize its profit, in the short run a perfectly competitive firm decides

1,200; $3,600

Use the figure above to answer this question. If the firm is maximizing profit, it will produce ________ units and make an economic profit of ________.

1,000 units will be produced and there is no deadweight loss

Use the figure above to answer this question. If the market was perfectly competitive

$40; $40

Use the figure above to answer this question. Pam gives the only piano lessons in town. In order to maximize profit, Pam should charge ________ per lesson and will earn a total economic profit of ________.

4; $50; maximize profit

Use the figure to answer this question. Mary is the only veterinarian in a small town. To maximize her profit, Mary will choose to treat ________ animals per hour and charge ________ per customer in order to ________.

a smaller; a higher

When compared to a perfectly competitive market, a single-price monopoly with the same costs produces ________ output and charges ________ price.

$8; $12

When the market is perfectly competitive, the price of a pound of steak is ________ and when it is a monopoly, the price of a pound of steak is ________.

$18 each

Suppose a single-price monopoly sells 3 units of a good at $20 per unit. If the monopoly sells 4 units, the total revenue increases to $72. What price is being charged for 4 units?

$2,800

Computer memory chips are produced on wafers, each wafer having many separate chips that are separated and sold. The above table shows costs for a perfectly competitive producer of computer memory chips. Assuming identical firms in the market place, we expect the long-run market price of a wafer to be:

is able to sell different units of a good at different prices

Price discrimination occurs when a firm

enter; supply curve shifts rightward

If firms in a perfectly competitive market are incurring economic profits, then as time passes firms ________ and the market ________.

20; $3.00

In order to maximize profit, the Busy Bee produces ________ hamburgers per hour and sets a price of ________ per hamburger.

legal barrier to entry and allows; greater than marginal cost

Mylan Pharmaceuticals holds a patent on the EpiPen - designed to inject epinephrine into shock victims. In 2016, Mylan received criticism for charging $600 for this life-saving drug. Mylan's patent is a ________ Mylan to charge a price ________.