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Exam 12: Pure Monopoly

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Question 31

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A monopolist, being the sole seller in a market, is assured of positive economic profits.

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Question 32

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"Price makers" refers to firms that

A) face a downward-sloping demand curve.
B) are pure monopolies, rather than monopolistic competitors.
C) have no ability to influence the market price.
D) are pure monopolies or monopolistic competitors, but not oligopolies.

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Question 33

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Suppose that a monopolist calculates that at its present output level, marginal cost is $2.00 and marginal revenue is $3.00. The firm could increase profits by

When compared with the purely competitive industry with identical costs of production, a monopolist will produce

Suppose that a monopolist calculates that at its present output level, marginal revenue is $4.50 and marginal cost is $2.75. It could maximize profits or minimize losses by

What is a patent? How long is the life of a patent?

Because of their large-scale level of production, pure monopolists overallocate resources to their industry by producing beyond the P = MC output.

Suppose that a pure monopolist can sell 15 units of output at $6 per unit and 16 units at $5.70 per unit. For the monopolist to profitably produce and sell the sixteenth unit of output, its marginal cost must be anywhere at or below

Answer the question on the basis of the provided demand and cost data for a pure monopolist. The profit-maximizing price for the monopolist will be

At its profit-maximizing output, a pure nondiscriminating monopolist achieves

Answer the question on the basis of the provided demand and cost data for a pure monopolist. The profit-maximizing monopolist will realize a

What is the dilemma of regulation in the case of a regulated monopoly?

Why is marginal revenue less than price for every level of output except the first for the monopolist?

The table shows the demand schedule facing Nina, a monopolist selling baskets. If Nina had no production costs, what price would she charge to maximize profits?

Refer to the demand and cost data for a pure monopolist given in the table. An unregulated, nondiscriminating monopolist would earn maximum profits of

Refer to the two diagrams for individual firms. Figure 2 pertains to

Refer to the diagram for a nondiscriminating monopolist. If the government regulates the monopolist so that it charges the "fair return" price, the monopolist will produce output N.

Which of the following is a barrier to entry?

A market where there are many firms, but one firm dominates and has the bulk (85 percent) of sales in the market, is called a

Extensive network effects may drive a market toward natural monopoly because consumers tend to choose a common, standard product that everyone else is using.