Pure Monopoly (Pg. 283-298) Exam
Q&A
The level of profit that occurs when total revenue is equal to total cost is known as
___ profit. - ANSWER-The level of profit that occurs when total revenue is equal to
total cost is known as normal profit.
For a monopoly, the marginal revenue is below the demand curve because: -
ANSWER-The monopoly has to lower the price on all units to sell more.
Which of the following are characteristics of a perfectly competitive market? -
ANSWER--Large number of sellers
-No control over price
Marginal revenue is the: - ANSWER-Extra or additional revenue associated with the
production of an additional unit of output.
When a firm has a loss, the total ___ is less than the total ___. - ANSWER-When a
firm has a loss, the total revenue is less than the total cost
Productive efficiency is: - ANSWER-Using the fewest resources possible to produce
a good or a service.
A monopoly will charge consumers the price that they're willing and able to pay for
the amount of output available, which is shown along the ___ cruve. - ANSWER-A
monopoly will charge consumers the price that they're willing and able to pay for the
amount of output available, which is shown along the demand cruve.
A person who invented the ability to time travel will likely operate as a, ___ because
there would be no substitutes and entering that market would be difficult for anyone
else. - ANSWER-A person who invented the ability to time travel will likely operate as
a, monopoly because there would be no substitutes and entering that market would
be difficult for anyone else.
If the marginal revenue associated with selling one more unit of output is positive,
the demand is: - ANSWER-Elastic, because this would increase total revenue.
If selling another unit of output increases revenue, marginal revenue is ___. -
ANSWER-If selling another unit of output increases revenue, marginal revenue is
positive.
If selling another unit of output increases revenue, demand is ___. - ANSWER-If
selling another unit of output increases revenue, demand is elastic.
Monopolies do not achieve ___ efficiency, because they do not produce in such a
way that their price equals marginal cost. - ANSWER-Monopolies do not achieve
Q&A
The level of profit that occurs when total revenue is equal to total cost is known as
___ profit. - ANSWER-The level of profit that occurs when total revenue is equal to
total cost is known as normal profit.
For a monopoly, the marginal revenue is below the demand curve because: -
ANSWER-The monopoly has to lower the price on all units to sell more.
Which of the following are characteristics of a perfectly competitive market? -
ANSWER--Large number of sellers
-No control over price
Marginal revenue is the: - ANSWER-Extra or additional revenue associated with the
production of an additional unit of output.
When a firm has a loss, the total ___ is less than the total ___. - ANSWER-When a
firm has a loss, the total revenue is less than the total cost
Productive efficiency is: - ANSWER-Using the fewest resources possible to produce
a good or a service.
A monopoly will charge consumers the price that they're willing and able to pay for
the amount of output available, which is shown along the ___ cruve. - ANSWER-A
monopoly will charge consumers the price that they're willing and able to pay for the
amount of output available, which is shown along the demand cruve.
A person who invented the ability to time travel will likely operate as a, ___ because
there would be no substitutes and entering that market would be difficult for anyone
else. - ANSWER-A person who invented the ability to time travel will likely operate as
a, monopoly because there would be no substitutes and entering that market would
be difficult for anyone else.
If the marginal revenue associated with selling one more unit of output is positive,
the demand is: - ANSWER-Elastic, because this would increase total revenue.
If selling another unit of output increases revenue, marginal revenue is ___. -
ANSWER-If selling another unit of output increases revenue, marginal revenue is
positive.
If selling another unit of output increases revenue, demand is ___. - ANSWER-If
selling another unit of output increases revenue, demand is elastic.
Monopolies do not achieve ___ efficiency, because they do not produce in such a
way that their price equals marginal cost. - ANSWER-Monopolies do not achieve
