ECON MONOPOLY
Suppose Carl'ss candies sells 100 boxes of candy for $5 each. The total fixed cost of the $100 boxes, and the average variable cost of $100 boxes is $1.50 per box. Carl's makes a total profit of:
250$
A pure __________ is the only seller in a market
Monopoly
A pure _______is a price maker engaging in nonprice competition
Monopoly
Monopoly is a market structure characterized by
a good or service for which there are no close up substitutes a singer seller the firm's having significant price control a market with berries to entry
A monopoly is not really a monopoly when there are no________ to entry
barriers
__________markets maximize the ability of good and services and the consumer's ability to buy them
competitive
For the profit-maximizing level of output, the price charged by a monopoly is not just different but greater than marginal
cost
Normal profit is also known as zero _____ profit
economic
If the marginal revenue associated with selling one more unit of output is positive, the demand is:
elastic, because this would increase the total revenue
The marginal revenue is the
extra or additional revenue associated with the production of an additional unit of output
Government usually regular monopolies when the __________ cost associated with the production of an essential good or service are relatively ________, and it may not make sense to have multiple firms duplicating these cost
fixed large
The practice of selling the same good or service to different customers at different prices is known as
price discrimination
Total Revenue (TR)
price times quantity
If you live in a town or city that has a single provider of electricity or natural gas, that natural monopoly provider is most likely a _________monopoly
regulated
When regulators required a monopoly to charge the normal profit price
the Monopoly has zero economic profit the Monopoly has little incentive to reduce its cost of production
When a firm has a loss, the total revenue is ______ than the total cost
less
Monopolist produces ____output than competitive markets and are likely to hire _____labor
less less
Natural monopolies are rare and tend to be regulated by the government
true
There are a few important exceptions in which monopolies are actually encourage to incentivize positive outcomes
true
Productive efficiency is
using the fewests resources possible to produce a good or service
A company can break even and meet operating costs without a loss when it earns ______ economic profit
zero
All firms maximize profits by producing the quantity of output at which the marginal_____ is equal to the marginal____
cost revenue