Pure Monopoly Quiz

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Posted on

March 14th, 2023

question

An unregulated pure monopolist will maximize profits by producing that output at which:

answer

MR = MC.

question

Barriers to entering an industry:

answer

are justified because they result in allocative efficiency.

question

Comparing a pure monopoly and a purely competitive firm with identical costs, we would find that the pure monopolist:

answer

produces a lower output at a higher price than the pure competitor.

question

If a monopolist engages in price discrimination, it will:

answer

charge customers different prices for products, unrelated to cost differences.

question

If a regulatory commission forces a natural monopoly to charge a price equal to its average total cost:

answer

the monopolist will realize a normal profit, economic profits will be zero.

question

Producing where P = ATC, causes a monopolist to:

answer

earn zero economic profits or a normal profit.

question

Pure monopolists may obtain economic profits in the long run because:

answer

of barriers to entry.

question

The pure monopolist's demand curve is:

answer

the same as the industry demand curve.

question

Which of the following is a characteristic of pure monopoly that allows the firm to earn economic profits in the long-run?

answer

barriers to entry

question

Which of the following is characteristic of a pure monopolist's demand curve?

answer

It is the same as the industry demand curve.

question

true or false: A purely competitive firm is a "price taker," while a monopolist is a "price maker."

answer

true

question

label the photo

answer

a: monopoly earning economic profits

b. monopoly earning economic losses

c. monopoly earning normal profits (breaking even)

d. pure competition earning normal profits (breaking even)

question

characteristics of the graph

answer

- it shows economic profits

- when does MR=MC

- net revenue is $1,000

- total cost of the monopolist is $2,000

- total revenue is $3,000

- what point maximizes profits: (100, 30)

1 of 13

question

An unregulated pure monopolist will maximize profits by producing that output at which:

answer

MR = MC.

question

Barriers to entering an industry:

answer

are justified because they result in allocative efficiency.

question

Comparing a pure monopoly and a purely competitive firm with identical costs, we would find that the pure monopolist:

answer

produces a lower output at a higher price than the pure competitor.

question

If a monopolist engages in price discrimination, it will:

answer

charge customers different prices for products, unrelated to cost differences.

question

If a regulatory commission forces a natural monopoly to charge a price equal to its average total cost:

answer

the monopolist will realize a normal profit, economic profits will be zero.

question

Producing where P = ATC, causes a monopolist to:

answer

earn zero economic profits or a normal profit.

question

Pure monopolists may obtain economic profits in the long run because:

answer

of barriers to entry.

question

The pure monopolist's demand curve is:

answer

the same as the industry demand curve.

question

Which of the following is a characteristic of pure monopoly that allows the firm to earn economic profits in the long-run?

answer

barriers to entry

question

Which of the following is characteristic of a pure monopolist's demand curve?

answer

It is the same as the industry demand curve.

question

true or false: A purely competitive firm is a "price taker," while a monopolist is a "price maker."

answer

true

question

label the photo

answer

a: monopoly earning economic profits

b. monopoly earning economic losses

c. monopoly earning normal profits (breaking even)

d. pure competition earning normal profits (breaking even)

question

characteristics of the graph

answer

- it shows economic profits

- when does MR=MC

- net revenue is $1,000

- total cost of the monopolist is $2,000

- total revenue is $3,000

- what point maximizes profits: (100, 30)

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