Econ Final Clicker ?s
"If regulators had not approved mergers in the past decade between major networked airlines, travelers would be better off today" a. agree b. disagree c. uncertain
a
"Behavior in many complex and seemingly intractable strategic settings can be understood more clearly by working out what each party in the game will choose to do if they realize that the other parties will be solving the same problem. This insight has helped us understand behavior as diverse as military conflicts, price setting by competing firms and penalty kicking in soccer." a. agree b. disagree c. uncertain
a.
perfect price discrimination a. raises profit b. raises total surplus c. lowers consumer surplus d. all of the above are correct
d
Defenders of advertising argue that advertising a. provides information to customers. b. signals quality about a product. c. promotes competition in a market. d. All of the above are correct.
d.
P ($): 10 9 8 7 6 5 4 3 2 1 0 Q: 0 25 50 75 100 125 150 175 200 225 250 TR: 0 225 400 525 600 625 600 525 400 225 0 Only two firms, Loft and Eagle produce golf balls. The table shows the demand curve for packages of golf balls. Each firm has the same constant marginal cost of $2. Loft and Eagle agree to maximize joint profits. However, while Loft produces the agreed upon amount, Eagle breaks the agreement and produces 25 more than agreed, how much profit does Eagle make? a. $375 b. $300 c. $250 d. $225
d.
Economists consider monopolies to be inefficient b/s they can earn profits in the long run True or false
false
A duopoly is an oligopoly with only two buyers True or False?
False
For a firm in a monopolistically competitive market, the relationship between price, marginal revenue and average revenue is: P=AR=MR True or False?
False
In equilibrium, the relationship between price, marginal revenue, and marginal cost for a monopoly is: P<MR=MC True or False?
False
Monopolistic competition refers to a market structure in which a single firm sells a good with no close substitutes True or False?
False
A monopolistic competitor chooses its short-run profit-maximizing quantity the same way that a monopoly does True or False?
True
A natural monopoly can supply a good to the entire market at a lower cost than two or more firms could True or False?
True
Oligopoly refers to a market structure in which a few sellers offer identical or similar products True or False?
True
The market for tennis balls is an example of an oligopoly True or False?
True
A monopolistically competitive market structure is similar to perfect competition in that a. there are many firms in the industry. b. firms sell identical products. c. entry of new firms in the long run is not possible. d. firms can earn economic profits in the long run.
a.
Firm A produces a razor that is very comfortable to use and lasts a long time. Firm B produces a razor that is less comfortable to use and wears out faster. Both firms are profit maximizers. Given these facts, we would expect a. Firm A to spend more on advertising than firm B b. Firm B to spend more on advertising than Firm A c. both firms to spend heavily on advertising d. neither firm to advertise
a.
The oligopolists are best of when they: a. cooperate and act like a monopolist. b. cooperate and act like perfectly competitive firms. c. do not cooperate and act like monopolistically competitive firms. d. do not cooperate and act like a monopolist.
a.
Under-Gear is one of the many producers of women's athletic gear that is currently earning zero economic profit. Which of the following changes will occur in the short run (for Under-Gear) if women started exercising more (and buying more athletic gear)? a. an increase in demand and profits b. an increase in demand and a decrease in profits c. a decrease in demand and profits d. a decrease in demand and an increase in profits
a.
In comparison to a perfectly competitive firm, a monopolist charges a a. higher price and produces a higher quantity b. higher price and produces a lower quantity c. lower price and produces a higher quantity d. lower price and produces a lower quantity
b
P: 20 18 16 14 12 10 Q: 0 1 2 3 4 5 Refer to the table which illustrates the demand curve for a monopolist. Suppose the firm's marginal cost is constant at $5 and there are no fixed costs. This monopolist will produce a. 5 units of output and charge a price of $10 b. 4 units of output and charge a price of $12 c. 3 units of output and charge a price of $14 d. 2 units of output and charge a price of $16
b
Games that are repeated are more likely to a. make collusive agreements less stable. b. make the enforcement of collusive agreements more feasible. c. lead to outcomes dictated by individual self interest. d. lead to violation of cartel agreements.
b.
The long-run equilibrium of a monopolistically competitive market generates a. no deadweight loss and zero economic profits. b. deadweight loss and zero economic profits. c. no deadweight loss and positive economic profits. d. deadweight loss and positive economic profits.
b.
When a movie theater offers a discounted ticket to moviegoers over the age of 65, it engages in a. price discrimination and increases the deadweight loss. b. price discrimination and decreases the deadweight loss. c. revenue maximization and decreases the deadweight loss. d. perfect price discrimination and decreases the deadweight loss.
b.
P ($): 10 9 8 7 6 5 4 3 2 1 0 Q: 0 25 50 75 100 125 150 175 200 225 250 TR: 0 225 400 525 600 625 600 525 400 225 0 Only two firms, Loft and Eagle produce golf balls. The table shows the demand curve for packages of golf balls. Each firm has the same constant marginal cost of $2. If this market were perfectly competitive instead of oligopolistic, what would the price be? a. $4 b. $3 c. $2 d. $1
c
P: 20 18 16 14 12 10 Q: 0 1 2 3 4 5 Refer to the table which illustrates the demand curve for a monopolist. Suppose the firm's marginal cost is constant at $5, and there are no fixed costs. By producing the profit-maximizing output, this monopolist will earn total profits of a. $12 b. $27 c. $28 d. $37
c
Suppose that a monopolist is producing a level of output such that marginal revenue exceeds marginal cost. To increase profits, this monopolist should a. increase output and increase price. b. decrease output and decrease price. c. increase output and decrease price. d. decrease output and increase price.
c
Critics of advertising argue that advertising a. provides information to customers. b. lowers prices. c. manipulates consumer's tastes. d. increases the variety of products.
c.
In the long-run equilibrium of a monopolistically competitive market, price a. equals marginal cost, and price equals average total cost. b. equals marginal cost, and price is greater than average total cost. c. is greater than marginal cost, and price equals average total cost. d. is greater than marginal cost, and price is greater than average total cost.
c.
P ($): 10 9 8 7 6 5 4 3 2 1 0 Q: 0 25 50 75 100 125 150 175 200 225 250 TR: 0 225 400 525 600 625 600 525 400 225 0 Only two firms, Loft and Eagle produce golf balls. The table below shows the demand curve for packages of golf balls. Each firm has the same constant marginal cost of $2.Refer to the table. If Loft and Eagle operate to jointly maximize profits, then what is the price? a. $8 b. $7 c. $6 d. $5
c.
The entry of a new firm into a monopolistically competitive market generates a. only a positive externality on consumers when consumers gain consumer surplus from the introduction of a new product. b. only a negative externality on existing firms when some firms lose customers to the entering firm. c. both a positive externality on consumers and a negative externality on existing firms. d. neither negative nor positive externalities.
c.
Which of the following is not example of price discrimination? a. Nabisco provides cents-off coupons for Oreos. b. Amtrak offers a lower price for weekend travel compared to weekday rates on the same routes. c. Hotel rates are lower for AAA members than for nonmembers. d. Lamb's wool sweaters are less expensive than cashmere sweaters.
d.