Viegbesie

the only market structure in which there is significant interpendence amoung firms with regard to their pricing and output decisions is what?

monopoly

the correct ranking of barriers to entry (from highest to lowest) in the market is

monopoly, monopolistic competition, oligopoly, perfect competition

when the MPP of labor is zero what happens

no furtherincreases in output can be acheived by using additional units of labor

The pricing strategy in which one firm is allowed by its rivals to establish the market price for all firms in the market is called?

overt Collusion

to maximize profits or minimize losses, a monopolist should at so that

p=AC

a regulated natural monopoly is more likely to advertise freely under which of the following types of regulation

profit regulation

oligopolists have a mutual interest in coordinating production decisions in order to maximize combined what

profits

A market in which a single seller is required for efficient production is a

pure monopoly

The labor-supply curve depicts the?

quantities of labor supplied at alternative wage rates

the first major regulatory target in the United States was

railroads

Economic regulation includes:

regulation of prices

the collapse of AT&T's natural monopoly in long distance telephone service was cause by

satellite technology which made it easier and less expensive for new companies to provide long-distance service

The number of firms in an oligopoly must be what?

small enough so that one firm's decisions have significant impact on the decisions of the other firms in the industry

the creation of another antitrust agency besides the justice department was accomplished through what?

the Federal Trade Commission act

What prohibits price discrimination, certain types of mergers, and interlocking boards of directors among competing companies

the Sherman Act

what market best illustrates the practice of price discrimination

the airline market

Which of the following is the same for monopoly and competitive under the same cost and demand conditions?

the amount of output that is produced

Price discrimination

the business practice of selling the same good at different prices to different customers

a clothing store can sell two shirts for $20 each or three shirts for $18 each. At a quantity of three shirts sold, marginal revenue is

$14

suppose that a monopoly firm produces tables and can sell 10 tables per month at a priceof $400 per table. in order to increase sales by one table per month, the monopolist must lower the price of its tables by $30 to $370 per table. what is the marginal revenue of the eleventh table?

$70

In what market structures are entry barriers the highest?

monopoly

monopoly power

A firm with monopoly power has some control over price

A market that experiences both strikes and lockouts at different times is most likely characterized by?

Bilateral Monopoly

A multiplant monopolist produces more than if each of its plants were separate firm in a competitive market

False

If marginal revenue product is declining, the marginal physical product must decline.

False

Regulated monopolies that are allowed a specific profit rate have an incentive to hold down costs

False

Unlike most monopolies, unions do not attempt to use their market power to raise the equilibrium wage above its competitive level

False

Jane loves to work. she does not receive any enjoyment from leisure time. the last dollar that she earns each year means just as much to as the first. what describes the shape of Jane's labor supply curve?

Horizontal

the law of diminishing returns states that

MPP of labor declines as more labor is employed

what rules will always be satisfied when any firm has maximized profits?

MR=MC

Oligopolistic firms will maximize total profits for all of the firms in the market at the rate of output

MR=MC for the market

Market failure includes:

Market power resulting in reduced output and higher price

which market structure is characterized by a few interdependent firms?

Oligopolistic

The soft drink market is dominated by Coke, Pepsi, and very few other firms. the firms often start price wars. How best is the market classified?

Oligopoly

Price descrimination allows a producer to what?

Reap the highest possible average price for the quantity

Ceteris paribus, if immagration to the United States increases the number of workers what will happen

The labor-supply curve will shift to the right and the equilibrium wage rate will fall

A monoposonist must raise the wage rate if it desires to hire additional workers.

True

Antitrust laws can restrain the abuse of monopoly power

True

If close substitutes are available which have only slight product differentiation, a firm is not a monopoly

True

the opportunity cost of working is the amount of leisure time that must be given up in order to work.

True

the long-run average total cost curve of a natural monopolist is?

U-shaped

when a regulatory agency hires personnel to enforce regulations, the cost is

a compliance cost

what is likely to be a monopolist

a drug firm that has a patent granting it the exclusive right to produce a drug

compared with the profit-maximizing choice of a natural monopolist, output regulation will result in what

a higher level of output and a lower price

a gap in the marginal revenue curve results from

a kinked demand curve

the refusal to work by unionized labor is an example of what

a strike

which of the follwoing may characterize oligopolistic behavior

all of them

economies of scale over the entire range of market output

all the above

the danger of experimenting with pricing for an oligopoly is

all the above

the doctrine of laissez faire is consistent with what?

all the above

what is an example of government failure?

all the above

according to the text, what type of market failure provides the best case for government regulation

market power

At very high wage rates, it is likely than individual's labor-supply can what?

bend backwards

when firms have the power to restrict output, raise prices, stifle competition, and inhibit innovation the market failure involves what?

market power

the marginal revenue product of labor is equal to what

change in total revenue/ change in quantity of labor

what is marginal wage

change in total wages paid/ change in quantity of labor employed

the marginal factor cost is what?

change in total wages/ change in quantity of labor

an individual's labor-supply curve reflects his or her what?

choice between work and leisure

when officers of firms in an industry get together to discuss how they can improve their mutual well-being, the result is

collusion

The most common form of non-price competition is what?

collusion, advertising, patents

which regulatory cost is borne by the firms which are regulated

compliance costs

one could argue that advertising

creates barriers to entry

which of the following is a barrier to entry in a monopoly market

difficulty in obtaining resources

the demnad for labor is downward sloping because

diminishing returns to labor

what is the supply curve for a monopolist?

does not exist

The concept of Laisesez faire calls for government intervention if market failure is evident

false

when there is market failure

government intervention is beneficial only when the marginal benefit of intervention exceeds the marginal cost

Typical goals of a labor union in the United States include what?

higher wages, better working conditions, more job security

a monpolist wo dies not practice discrimination should never produce in the

inelastic portion of its demand curve because its can increase total revenue by more than it increases toal cost by reducing the price

if a firm can raise market price by reducing its output, then what?

it faces a downward-sloping demand curve

the responsiveness of workers to a change in wage rates, ceteris paribus, is measured by what?

labor demand curve

a profit-maximization monosonist will hire workers at the point where the marginal factor cost curve intersects

marginal revenue product curve

competitive firms and monopolies both face downwar-sloping what?

market demand curves

when an individual's MRP is not measurable, his or her market wage is usually determined by

the individuals MPP

what firm is most likely to have more market power?

the only airline serving two cities

the demand curve faced by a monopoly firm is

the same as the amrket demand for the product

to be successful in changing wage rates and employment conditions, labor unions need to have control over what?

their own membership

as long as additional workers are attracted into the labor force by higher wages, the market labor supply curve is what?

upward-sloping

the quantity of labor demanded can change without shifting labor demand curve when there is a change in what?

wage rate

what will happen to wages and the level of employment in a competitive market when the government eliminates a minimum wage

wages will fall but employment will rise

if the selles of labor in a competitive market decided to unionize, what what would happen?

wages would rise and employment would fall