ReviewCh15 - chapter15 Multiple Choice Identify the choice...

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chapter15 Multiple Choice Identify the choice that best completes the statement or answers the question. ____ 1. Which of the following is not a characteristic of a monopoly? a. barriers to entry b. one seller c. one buyer d. a product without close substitutes ____ 2. Which of the following is not an example of a barrier to entry? a. Mighty Mitch’s Mining Company owns a unique plot of land in Tanzania, under which lies the only large deposit of Tanzanite in the world. b. A pharmaceutical company obtains a patent for a specific high blood pressure medication. c. A musician obtains a copyright for her original song. d. An entrepreneur opens a popular new restaurant. ____ 3. Patent and copyright laws encourage a. creative activity. b. lower prices due to decreasing average total costs. c. competition among firms. d. Both a and b are correct. ____ 4. Which of the following is a characteristic of a natural monopoly? a. Marginal cost declines over large regions of output. b. Average total cost declines over large regions of output. c. The product sold is a natural resource such as diamonds or water. d. All of the above are correct. ____ 5. The market demand curve for a monopolist is typically a. unit price elastic. b. downward sloping. c. horizontal. d. vertical. ____ 6. In order to sell more of its product, a monopolist must a. sell to the government. b. sell in international markets. c. lower its price. d. use its market power to force up the price of complementary products. ____ 7. Economists assume that monopolists behave as a. cost minimizers. b. profit maximizers. c. price maximizers. d. maximizers of social welfare. ____ 8. The supply curve for the monopolist a. is horizontal. b. is vertical. c. is upward sloping.
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d. does not exist. ____ 9. Monopolies use their market power to a. charge prices that equal minimum average total cost. b. increase the quantity sold as they increase price. c. charge a price that is higher than marginal cost. d.
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This note was uploaded on 12/02/2011 for the course ECON ECON200 taught by Professor Songhualin during the Fall '11 term at Maryland.

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ReviewCh15 - chapter15 Multiple Choice Identify the choice...

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