review exercises_ch15 16 17

review exercises_ch15 16 17 - Review exercises for...

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Review exercises for Monopoly, Oligopoly, Monopolistic Competition Monopoly Ch 15 7.Which of the following are necessary characteristics of a monopoly? (i) The firm is the sole seller of its product. (ii) The firm's product does not have close substitutes. (iii)The firm generates a large economic profit. (iv)The firm is located in a small geographic market. a. (i) and (ii) b. (i) and (iii) c. (ii) and (iv) d. (i), (ii), and (iii) Figure 15-1 24. Refer to Figure 15-1 . The shape of the average total cost curve reveals information about the nature of the barrier to entry that might exist in a monopoly market. Which of the following monopoly types best coincides with the figure? a. Ownership of a key resource by a single firm b. Natural monopoly
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c. Government-created monopoly d. A patent or copyright monopoly 55. If a profit-maximizing monopolist faces a downward-sloping market demand curve, its a. average revenue is less than the price of the product. b. average revenue is less than marginal revenue. c. marginal revenue is less than the price of the product. d. marginal revenue is greater than the price of the product. 59. For a profit-maximizing monopolist, a. P > MR = MC. b. P = MR = MC. c. P > MR > MC. d. MR < MC < P. Table 15-1
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Quantity Price Total Revenue Average Revenue Marginal Revenue 1 35 35 2 64 32 29 3 29 4 17 5 23 11 6 120 7 17 -1 8 -7 9 99 11 -13 10 80 8 67. Refer to Table 15-1 . If the monopolist sells 8 units of its product, how much total revenue will it receive from the sale? a. 14 b. 40 c. 112 d. 164 68. Refer to Table 15-1 . If the monopolist wants to maximize its revenue, how many units of its product should it sell? a. 4 b. 5 c. 6 d. 8 69. Refer to Table 15-1 . When 4 units of output are produced and sold, what is average revenue? a. 17 b. 21 c. 23 d. 26
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70. Refer to Table 15-1 . What is the marginal revenue for the monopolist for the sixth unit sold? a. 3 b. 5 c. 11 d. 17 71. 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? a. Q = 4, P = $29 b. Q = 4, P = $26 c. Q = 5, P = $23 d. Q = 7, P = $17 Figure 15-2 The figure below illustrates the cost and revenue structure for a monopoly firm. 77. Refer to Figure 15-2 . The demand curve for a monopoly firm is depicted by curve a. A. b. B. c. C. d. D. 78. Refer to Figure 15-2 . The marginal revenue curve for a monopoly firm is depicted by curve
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a. A. b. B.
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review exercises_ch15 16 17 - Review exercises for...

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