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Pure monopoly refers to
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a single firm producing a product for which there are no close substitutes.
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A natural monopoly occurs when
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long-run average costs decline continuously through the range of demand.
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Which of the following is a barrier to entry?
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patents and licenses
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If a nondiscriminating imperfectly competitive firm is selling its 100th unit of output for $35, its marginal revenue
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will be less than $35
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If profits are maximized (or losses minimized), which of the following conditions is common to both unregulated monopoly and pure competition?
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MR=MC
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Which of the following statements is correct?
The pure monopolist will maximize profit by producing at that point on the demand curve where elasticity is zero.
The pure monopolist maximizes profits by producing that output at which the differential between price and average cost is the greatest.
Purely monopolistic sellers earn only normal profits in the long run.
In seeking the profit-maximizing output, the pure monopolist under allocates resources to its production.
The pure monopolist will maximize profit by producing at that point on the demand curve where elasticity is zero.
The pure monopolist maximizes profits by producing that output at which the differential between price and average cost is the greatest.
Purely monopolistic sellers earn only normal profits in the long run.
In seeking the profit-maximizing output, the pure monopolist under allocates resources to its production.
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In seeking the profit-maximizing output, the pure monopolist under allocates resources to its production.
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Which of the following is not a basic characteristic of monopolistic competition?
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recognized mutual interdependence
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A monopolistically competitive firm has a
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highly elastic demand curve.
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A monopolistically competitive firm's marginal revenue curve
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is downsloping and lies below the demand curve.
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In the short run, the price charged by a monopolistically competitive firm attempting to maximize profits or minimize losses
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In the short run, the price charged by a monopolistically competitive firm attempting to maximize profits or minimize losses
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Over the long run in a monopolistically competitive industry, a single firms price will be
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equal to atc
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In the long run, economic theory predicts that a monopolistically competitive firm will
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have excess production capacity.
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A monopolistically competitive firm is producing at an output level in the short run where average total cost is $4.50, price is $4.00, marginal revenue is $2.50, and marginal cost is $2.50. This firm is operating
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with a loss
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Oligopolistic industries are characterized by
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a few dominant firms and substantial entry barriers.
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An industry having a four-firm concentration ratio of 85 percent
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is an oligopoly
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Suppose that total sales in an industry in a particular year are $600 million and sales by the top four sellers are $200 million, $150 million, $100 million, and $50 million, respectively. We can conclude that
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the concentration ratio is more than 80 percent
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Which statement about oligopoly is false?
- oligopoly firms recognize their interdependence.
-Prices in oligopoly are predicted to fluctuate widely and frequently.
-A few firms play an important role in the sale of a product.
-One firm's behavior is a function of what its rivals do.
- oligopoly firms recognize their interdependence.
-Prices in oligopoly are predicted to fluctuate widely and frequently.
-A few firms play an important role in the sale of a product.
-One firm's behavior is a function of what its rivals do.
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Prices in oligopoly are predicted to fluctuate widely and frequently.
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Industry Y is dominated by five large firms that hold market shares of 20, 20, 25, 10, and 25 percent. The four-firm concentration ratio for this industry is
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90 percent
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When firms in an industry reach an agreement to fix prices, divide up market share, or otherwise restrict competition, they are practicing the strategy of
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collusion
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The kinked-demand curve model of oligopoly is useful in explaining
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why oligopoly prices might change infrequently
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The real wage will rise if the nominal wage
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increases more rapidly than the general price level.
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A firm operating in a purely competitive resource market faces a resource supply curve that is
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perfectly elastic.
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A firm finds that it must increase wages to attract extra workers. The firm will hire labor up to the point where the marginal
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revenue product equals the additional cost of hiring an extra worker.
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1. W < MRP; W < MRC
2. W = MRP; W < MRC
3. W = MRP; W = MRC
4. W > MRP; W > MRC
Refer to the list. The outcome in a monopsony labor market is shown by
2. W = MRP; W < MRC
3. W = MRP; W = MRC
4. W > MRP; W > MRC
Refer to the list. The outcome in a monopsony labor market is shown by
answer
1
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