Monopoly Practice Questions

Monopoly Practice Questions - A) Entry of new firms B) The...

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Monopoly practice questions 1. If a company lowers its price of a product from $13 to $12, and the quantity demanded rises from 1 to 2 respectively, then: A) Total revenue falls to $24 B) Marginal revenue is $11 C) Marginal revenue is $24 D) Total revenue rises from $13 to $14 2. A monopoly: A) Is a market with only one seller B) Is a price maker C) Is a market with significant barriers to entry 3. The price a monopolist charges is: A) Equal to marginal revenue B) Is the price consumers are willing to pay for the profit maximizing level of output C) Is where marginal revenue equals marginal cost D) The same as in perfect competition 4. An example of a monopoly market is: A) Personal computers B) Sable minks produced in the Soviet Union C) Cellular phone service D) Autos 5 The ultimate limit to a monopolist's power is:
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Unformatted text preview: A) Entry of new firms B) The fact that it cannot control demand C) The inability to control the quantity of output D) Its inability to chose a profit maximizing level of output 6. One of the benefits of monopoly is: A) The production of a large quantity of output B) A monopolist can afford to spend more on research and development C) A monopolist price is established by supply and demand in the market D) A monopolist is forced to reduce costs of production 7. Monopolists set prices: A) On the marginal revenue curve B) Without constraints since there is no competition C) At the output where marginal revenue equals marginal cost D) At the minimum of the long-run average total cost curve...
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This note was uploaded on 04/10/2008 for the course ECO 203 taught by Professor Reinauer during the Fall '07 term at Rollins.

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Monopoly Practice Questions - A) Entry of new firms B) The...

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