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A monopolist faces a demand curve that is a.more elastic than a perfectly competitive f

  A monopolist faces a demand curve that is

a.more elastic than a perfectly competitive firm’s demand curve

b.the market demand curve

c.downward sloping as is the perfectly competitive firm’s demand curve but the
monopoly’s demand curve is more inelastic

d.horizontal as is the perfectly competitive firm’s demand curve but the monopoly’s
demand curve is more inelastic

e.totally insensitive to changes in consumer tastes

42.              If a monopolist lowers its price to increase sales from 100 to 200 units, then the

a.price at the 200th unit will be less than the marginal revenue of the 200th unit

b.price at the 100th unit will be greater than the marginal revenue of the 200th unit

c.profit earned producing 200 units will be greater than the profit earned producing
100 units

d.price at the 200th unit will be greater than the marginal revenue of the 200th unit

e.profit earned producing 100 units will be greater than the profit earned producing
200 units

43.              Unlike firms in perfect competition, monopolists have control over

a.the costs of production

b.what technology to use

c.what price to charge

d.how much to produce

e.the choice of plant size

44.              A monopolist earns $1,000,000 economic profit in the short run producing 25,000 units
                            of a good. The marginal revenue of the 25,000th unit is $23 and the marginal cost is $30.
                            What should the monopolist do?

a.raise price and produce less than 25,000 units

b.lower price and produce less than 25,000 units

c.raise price and produce more than 25,000 units

d.lower price and produce more than 25,000 units

e.produce more than 25,000 units at the same price

45.              Think of a firm that has a monopoly producing milk. The firm’s demand curve is

a.identical to the demand curve for milk facing the industry

b.identical to its marginal revenue curve

c.tangent to the firm’s ATC curve

d.tangent to its marginal revenue curve

e.more elastic than the demand curve of any perfectly competitive firm producing milk

46.              Suppose the baseball card industry is monopolistic. We know then that for the
                            monopolist,

a.price elasticity of demand everywhere along its demand curve is infinite

b.price elasticity of demand everywhere along the demand curve is zero

c.as price increases, marginal revenue decreases

d.as price decreases, marginal revenue decreases

e.price equals marginal revenue everywhere along its demand curve

47.              If total revenue is increased, which of the following must have been true?

a.MR = 0

b.MR > 0

c.MR = AR

d.MR

e.MR

48.              Picture in your mind’s eye the graph of a profit-maximizing monopolist. If its cost

curves—both ATC and MC—shift upward while its demand curve remains unchanged,
                            the monopolist will

a.decrease price and increase output

b.decrease both price and output

c.increase price and decrease output

d.increase both price and output

e.keep both price and output at the same level

49.              A chewing gum monopoly can sell 400,000 packages of gum for $0.10 each. If it wants
                            to sell 500,000 packages, its price must be

a.greater than the $0.10 if it doesn’t want to earn less profit

b.less than the marginal revenue of the 500,000th package

c.less than $0.10

d.equal to $0.10

e.none of the above makes sense

50.              The monopolist, unlike the perfectly competitive firm, continues to earn an economic
                            profit in the long run because

a.it can charge a higher price than its competitors and not lose market share

b.it can innovate, using its profit as research investment

c.it can out-compete its competitors

d.it has considerable market share

e.of impossible-to-overcome barriers to entry

Dec 09 2019 Read more Less More

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