AP Micro Unit 4 Test Multiple Choice Practice
Latest Update 2025-2026 Exam 60 Questions
with 100% Verified Correct Answers Guaranteed
A+
A - CORRECT ANSWER: For the monopolist to the right, DWL is:
A. DB
B. CD
C. AB
D. CDB
E. DBA
A - CORRECT ANSWER: In equilibrium, the firm will realize:
A. an economic profit of P0JD
B. an economic profit of PIJD
C. an economic profit of SIHB
D. a loss of DB per unit
E. a loss of SIHB
A - CORRECT ANSWER: The nondiscriminating monopolist's demand curve:
A. Is less elastic than a purely competitive firm's demand curve
B. is perfectly elastic
C. coincides with its marginal revenue curve
D. is perfectly inelastic
A - CORRECT ANSWER: Which of the following must be true for a firm that is a natural
monopoly? (think GA Power)
, A. it can produce and supply its product to an entire market at a lower cost than could a
number of smaller firms
B. it produces at the minimum of its average total cost curve
C. it has a patent on its product
D. it will not be able to maximize profits unless subsidized by the government
E. it is productively efficient for the government to break up the monopoly into smaller
firms
B - CORRECT ANSWER: Compared to industry represented in 1, the price for the
industry represented in 2 will be ________ and the quantity will be ________.
A. higher, higher
B. higher, lower
C. lower, lower
D. lower, higher
E. same
B - CORRECT ANSWER: Comparing a pure monopoly and a purely competitive firm
with identical costs, we would find in long-run equilibrium that the pure monopolist's:
A. price, output, and ATC would all be higher
B. price and ATC would be higher, but output would be lower
C. price, output, and ATC would be lower
D. price and output would be lower, but ATC would be higher
B - CORRECT ANSWER: Economic profit can e calculated as accounting profit minus
which of the following?
A. fixed costs
B. implicit costs
C. marginal costs
D. explicit costs
Latest Update 2025-2026 Exam 60 Questions
with 100% Verified Correct Answers Guaranteed
A+
A - CORRECT ANSWER: For the monopolist to the right, DWL is:
A. DB
B. CD
C. AB
D. CDB
E. DBA
A - CORRECT ANSWER: In equilibrium, the firm will realize:
A. an economic profit of P0JD
B. an economic profit of PIJD
C. an economic profit of SIHB
D. a loss of DB per unit
E. a loss of SIHB
A - CORRECT ANSWER: The nondiscriminating monopolist's demand curve:
A. Is less elastic than a purely competitive firm's demand curve
B. is perfectly elastic
C. coincides with its marginal revenue curve
D. is perfectly inelastic
A - CORRECT ANSWER: Which of the following must be true for a firm that is a natural
monopoly? (think GA Power)
, A. it can produce and supply its product to an entire market at a lower cost than could a
number of smaller firms
B. it produces at the minimum of its average total cost curve
C. it has a patent on its product
D. it will not be able to maximize profits unless subsidized by the government
E. it is productively efficient for the government to break up the monopoly into smaller
firms
B - CORRECT ANSWER: Compared to industry represented in 1, the price for the
industry represented in 2 will be ________ and the quantity will be ________.
A. higher, higher
B. higher, lower
C. lower, lower
D. lower, higher
E. same
B - CORRECT ANSWER: Comparing a pure monopoly and a purely competitive firm
with identical costs, we would find in long-run equilibrium that the pure monopolist's:
A. price, output, and ATC would all be higher
B. price and ATC would be higher, but output would be lower
C. price, output, and ATC would be lower
D. price and output would be lower, but ATC would be higher
B - CORRECT ANSWER: Economic profit can e calculated as accounting profit minus
which of the following?
A. fixed costs
B. implicit costs
C. marginal costs
D. explicit costs
