Chapter 15 Quiz

Refer to figure 15-11. If the monopoly firm perfectly price discriminates, then consumer surplus amounts to

$0

Which of the following statements is correct for both in monopolist and a perfectly competitive market?

(i) and (iv) only

Allowing an inventor to have the exclusive rights to market her new invention will lead to

(i), (ii), and (iii)

Which of the following is an example of a barrier to entry?

(i), (ii), and (iii)

Which of the following statements is true about patents and copyrights?

(i), (ii), and (iii)

Which of the following statements is true?

(ii) and (iii) only

In industry is a natural monopoly when

(iii) only

Refer to table 15-1. When 4 units of output are produced and sold, what is average revenue?

26

Refer to table 15-1. What is the marginal revenue for the monopolist for the sixth unit sold?

5

Refer to table 15-2. Which of the following quantities will achieve the maximum profit?

6

Refer to figure 15-4. If the monopoly firm is currently producing Q3 units of output, then a decrease in output will necessarily cause profit to

Increase as long as the new level of output is at least Q2

Refer to figure 15-13. How much output will the monopolist produce?

K

Refer to figure 15-5. A profit-maximizing monopoly will charge a price of

P4

Refer to figure 15-4. A profit maximizing monopoly's total revenue is equal to

P4*Q2

For a profit-maximizing monopolist

P>MR=MC

Customers who purchased a book from Dave's bookstore are charged 20% more than customers who purchased the same book from the Dave's bookstore website. This is an example of

Price discrimination

Refer to figure 15-5. A profit-maximizing monopoly will produce an output level of

Q3

Refer to table 15-1. Assume this monopolist's marginal cost is constant at $12. What quantity of output (Q) will it produce and what price (P) will it charge?

Q=4, P=$26

One difference between a perfectly competitive firm and a monopoly is that a perfectly competitive firm produces where

marginal cost equals price, while a monopolist produces where price exceeds marginal cost.

A reduction in a monopolist's fix costs would

not affect the profit-maximizing price or quantity