92 A profit maximizing monopoly produces a lower output level than would be

92 a profit maximizing monopoly produces a lower

  • New York University
  • MICRO 13
  • Test Prep
  • a133256
  • 4
  • 100% (14) 14 out of 14 people found this document helpful

This preview shows page 2 - 4 out of 4 pages.

92) A profit-maximizing monopoly produces a lower output level than would be produced if theindustry was perfectly competitive.92)Answer:TrueFalseDiff: 2Page Ref: 500/500Topic: Comparing Monopoly and Perfect CompetitionLearning Outcome: Micro 14: Discuss production and pricing decisions within monopolies and how publicpolicies affect monopoliesAACSB: Reflective Thinking30
93) If the market for a product begins as perfectly competitive and then becomes a monopoly, therewill be a reduction in economic efficiency and a deadweight loss.93)Diff: 2Page Ref: 500-501/500-501Topic: Monopoly and Economic EfficiencyLearning Outcome: Micro 14: Discuss production and pricing decisions within monopolies and how publicpolicies affect monopoliesAACSB: Reflective Thinking94) Suppose a monopoly is producing its profit-maximizing output level. Now suppose thegovernment imposes a lump-sum tax on the monopoly, independent of its output. As a result themonopolist will increase the price of its product to cover its higher cost.94)Diff: 2Page Ref: 499/499Topic: Monopoly and Economic EfficiencyLearning Outcome: Micro 14: Discuss production and pricing decisions within monopolies and how publicpolicies affect monopoliesAACSB: Analytic Skills95) Producers in perfect competition receive a smaller producer surplus than a monopoly producer.95)Diff: 2Page Ref: 500-501/500-501Topic: Comparing Monopoly and Perfect CompetitionLearning Outcome: Micro 14: Discuss production and pricing decisions within monopolies and how publicpolicies affect monopoliesAACSB: Reflective ThinkingESSAY. Write your answer in the space provided or on a separate sheet of paper.96) Equilibrium in a perfectly competitive market results in the greatest amount of economic surplus, or totalbenefit to society, from the production of a good. Why, then, did Joseph Schumpeter argue that an economymay benefit more from firms that have market power than from firms that are perfectly competitive?

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture