Chapter 14
Monopoly
Multiple Choice
10. Becau monopoly firms do not have to compete with other firms, the outcome in a market with a monopoly is often
a. not in the best interest of society.
b. one that fails to maximize total economic well-being.
c. inefficient.
d. All of the above are correct.
19. Which of the following scenarios best reprents a monopoly situation?
a. Bill and Tom work parately from one another but both ll a very rare form of the s
ame diamond. They are the only llers of this type of diamond in town.
b. Tom owns a fishing tackle shop in Miami, Florida, in which he lls the top-of-the-line fishing equipment.
c. Bill owns the only grocery store in a small community that lies 200 miles from the nearest city.
d. None of the above adequately reprents a monopoly.
34. If the distribution of water is a natural monopoly, then
(i) multiple firms will each have to pay large fixed costs to develop their own network of pipes.
(ii) allowing for competition among different firms in the water-distribution industry is efficient.
(iii) a single firm can rve the market at the lowest possible average total cost.
a. (i) and (ii)
b. (ii) and (iii)
c. (i) and (iii)
d. (i) only
38. The De Beers diamond monopoly is a classic example of a monopoly that
天门山门票多少钱一张 a. is government-created.
b. aris from the ownership of a key resource.
c. results in very little advertising of the product that the monopolist produces.
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d. was broken up by the government a long time ago.
52. When a firm operates under conditions of monopoly, its price is
a. not constrained.
b. constrained by marginal cost.
c. constrained by demand.
供不应求 d. constrained only by its social agenda.
60. For a monopolist, marginal revenue is
a. positive when the demand effect is greater than the supply effect.
b. positive when the monopoly effect is greater than the competitive effect.
c. negative when the price effect is greater than the output effect.
d. negative when the output effect is greater than the price effect.
69. When a monopolist increas the amount of output that it produces and lls, its average revenue
咸鱼烧肉 a. increas and its marginal revenue increas.
b. increas and its marginal revenue decreas.
c. decreas and its marginal revenue increas.
d. decreas and its marginal revenue decreas.
U the following table of numbers to answer questions 71 through 75.
Total Average Marginal
Quantity Price Revenue Revenue 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 8 80
71. If the monopolist lls 8 units of its product, how much total revenue will it receive from the sale?
a. 40
b. 112
c. 164
d. It cannot be determined from the information provided.
72. If the monopolist wants to maximize its revenue, how many units of its product should it ll?
a. 4
b. 5
c. 6
d. 8
73. 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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74. What is the marginal revenue for the monopolist for the sixth unit sold?
a. 3
b. 5
c. 11
d. 17
75. Assume this monopolist’s marginal cost is constant at $11. What quantity of output (Q) will it produce and what price (P) will it charge?
a. Q = 4, P = $27
b. Q = 4, P = $25
c. Q = 5, P = $23香港经典老歌
d. Q = 7, P = $17
The figure below reflects the cost and revenue structure for a monopoly firm. U it to answer questions 94 through 98.
94. A profit-maximizing monopoly’s total revenue is equal to
a. P3 Q2.
b. P2 Q4.
c. (P3 – P0) Q2.
d. (P3 – P0) Q4.
95. A profit-maximizing monopoly’s total cost is equal to
a. (P1 – P0) Q2.
b. P0 Q1.
c. P0 Q2.
d. P0 Q3.
96. A profit-maximizing monopoly’s profit is equal to
a. P3 Q2.
b. P2 Q4.
c. (P3 – P0) Q2.
d. (P3 – P0) Q4.
97. Profit on a typical unit sold for a profit-maximizing monopoly would equal
a. P2 – P1.
b. P2 – P0.
c. P3 – P2.
d. P3 – P0.
98. At the profit-maximizing level of output,
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a. marginal revenue is equal to P3.
b. marginal cost is equal to P3.
双龙戏猪c. average revenue is equal to P3.
d. None of the above are correct.
112. A monopolist will choo to increa output when
a. market price increas.
b. at all levels of output, marginal cost increas.
c. at the prent level of output, marginal revenue exceeds marginal cost.
d. All of the above are correct.
122. The profit-maximization problem for a monopolist differs from that of a competitive firm in which of the following ways?
a. A competitive firm maximizes profit at the point where marginal revenue equals marginal cost; a monopolist maximizes profit at the point where marginal revenue exceeds marginal cost.
