Archives: Quiz
Chapter 17 BP cannot do any better than drilling two wells
4446 Oligopoly Table 17–32 Suppose that Angelina and Brad own the only two professional photography stores in town. Each must choose between a low price and a high price for senior photo packages. The annual economic profit from each strategy […]
Chapter 17 Abby And Brad Own Wells That Produce
Oligopoly 4433 47. Ford and General Motors are considering expanding into the Vietnamese automobile market. Devise a simple prisoners’ dilemma game to demonstrate the strategic considerations that are relevant to this decision. ANSWER: The answer should present two strategies for […]
Chapter 17 what is the profit-maximizing price to charge for a salad
Oligopoly 4413 50. Refer to Scenario 17-5. If the restaurant is unable to use tying, what is the profit-maximizing price to charge for a salad? a. $16 b. $14 c. $12 d. $7 ANSWER: d POINTS: 1 DIFFICULTY: Difficulty: Moderate […]
Chapter 17 Resale Price Maintenance Can Lead to More Serviced
Oligopoly 4393 9. Which government entity is charged with investigating and enforcing antitrust laws? a. the U.S. Justice Department b. the U.S. Commerce Department c. the U.S. Treasury Department d. the Bureau of Alcohol, Tobacco, and Firearms ANSWER: a POINTS: […]
Chapter 17 The non-renewal of MFN trading status is likely to involve
Oligopoly 4373 135. Refer to Table 17-26. If both firms follow a dominant strategy, Firm A’s profits (losses) will be a. $–12m b. $-24m c. $–60m d. $–100m ANSWER: b POINTS: 1 DIFFICULTY: Difficulty: Moderate LEARNING OBJECTIVES: ECON.MANK.15.84 – LO: […]
Chapter 17 Brians Dominant Strategy Charge High Price c The
Oligopoly 4353 98. Refer to Figure 17-3. The dominant strategy for Hector is to a. clean, and the dominant strategy for Bart is to clean. b. clean, and the dominant strategy for Bart is to refrain from cleaning. c. refrain […]
Chapter 17 Firm Has Dominant Strategy But Firm Does
Oligopoly 4333 58. Refer to Scenario 17-4. In 1971, Congress passed a law that banned cigarette advertising on television. If cigarette companies are profit maximizers, it is likely that a. neither company opposed the ban on advertising. b. Brown Inc. […]
Chapter 17 Acme and Pinnacle agree to cooperate so as to maximize
Oligopoly 4313 21. Refer to Table 17-13. Suppose the owners of Lopes and HomeMax meet for a friendly game of golf one afternoon and happen to discuss a strategy to optimize growth related profit. If they both agree to cooperate […]
Chapter 17 The Economics Cooperation1 When Firms Are Faced
Oligopoly 4293 139. The theory of oligopoly provides another reason that free trade can benefit all countries because a. increased competition leads to larger deadweight losses. b. as the number of firms within a given market increases, the price of […]
Chapter 17 Then Equilibrium The Output Effect a Must Dominate
Oligopoly 4273 98. Refer to Table 17-12. Suppose we observe that the price of a gallon of gasoline in Driveaway is $5; we observe as well that a particular seller’s profit is $150. Given this observation, which of the following […]
Chapter 17 If the firms are able to collude successfully
Oligopoly 4253 64. Refer to Table 17-7. Assume there are two profit-maximizing internet radio providers operating in this market. Further assume that they are not able to collude on the price and quantity of subscriptions to sell. What price will […]
Chapter 17 They bring water to town and sell it at whatever price
Oligopoly 4233 Table 17-2 Imagine a small town in which only two residents, Abby and Brad, own wells that produce safe drinking water. Each week Abby and Brad work together to decide how many gallons of water to pump. They […]
Chapter 17 Which of the following statements about oligopolies is not correct
Oligopoly Multiple Choice – Section 00: Introduction 1. Which of the following statements about oligopolies is not correct? a. An oligopolistic market has only a few sellers. b. The actions of any one seller can have a large impact on […]
Chapter 16 Which letter identifies the efficient level of output for this firm
4198 Monopolistic Competition 20. Refer to Figure 16-12. If this firm profit–maximizes, what price will it charge? ANSWER: $58 POINTS: 1 DIFFICULTY: Difficulty: Moderate LEARNING OBJECTIVES: ECON.MANK.15.79 – LO: 16–2 NATIONAL STANDARDS: United States – BUSPROG: Analytic TOPICS: DISC: Monopolistic […]
Chapter 16 Empirical evidence suggests that advertising usually leads
Monopolistic Competition 4181 54. Empirical evidence suggests that advertising usually leads to an increase in the price for advertised products. a. True b. False ANSWER: False POINTS: 1 DIFFICULTY: Difficulty: Moderate LEARNING OBJECTIVES: ECON.MANK.15.80 – LO: 16-3 NATIONAL STANDARDS: United […]
Chapter 16 A monopolistically competitive market is like a competitive market
Monopolistic Competition 4161 15. A monopolistically competitive market is like a competitive market in that a. both market structures feature easy entry by new firms in the long run. b. the main objective of firms in both market structures is […]
Chapter 16 Brand Names May Help Consumers They Provide
Monopolistic Competition 4141 49. Critics of markets that are characterized by firms that sell brand name products argue that brand names encourage consumers to pay more for branded products that a. have elastic demand curves. b. are very different from […]
Chapter 16 Firms that spend the greatest percentage of their revenue
Monopolistic Competition 4121 7. Firms that spend the greatest percentage of their revenue on advertising tend to be firms that sell a. highly–differentiated consumer goods. b. goods produced by natural monopolies. c. agricultural products. d. products with a limited shelf […]
Chapter 16 Monopolistic competition is an inefficient market structure because
Monopolistic Competition 4101 225. Monopolistic competition is an inefficient market structure because a. price exceeds marginal cost. b. it has a deadweight loss, just as monopoly does. c. at the equilibrium, some consumers will value the good at more than […]
Chapter 16 When a monopolistically competitive firm is in long-run equilibrium
Monopolistic Competition 4081 182. When a monopolistically competitive firm is in long–run equilibrium, a. price is equal to average total cost. b. price is equal to marginal cost. c. price is equal to marginal revenue. d. the firm operates at […]
Chapter 16 Which of the following represents the excess capacity of this firm
Monopolistic Competition 4061 143. Refer to Scenario 16-3. How much profit will Peter earn each day if he chooses the price and quantity that maximize his profit? a. $176 b. $208 c. $225 d. $352 ANSWER: a POINTS: 1 DIFFICULTY: […]
Chapter 16 Which of the following is likely to happen in the long run in this market
Monopolistic Competition 4041 107. Refer to Figure 16–10. If the firm were to produce 154.92 units of output, a. efficient scale would be realized. b. ATC would be at its minimum value. c. the firm would sustain a loss of […]
Chapter 16 Which of the panels shown could illustrate the short-run situation
Monopolistic Competition 4021 70. Refer to Figure 16-4. Assume the firm in the figure is currently producing 20 units of output and charging $925. The firm a. will increase its profits if it raises its price and reduces its production […]
Chapter 16 When a profit-maximizing firm in a monopolistically competitive
Monopolistic Competition 4001 31. If “too much choice” is a problem for consumers, it would occur in which market structure(s)? a. perfect competition b. monopoly c. monopolistic competition d. perfect competition and monopolistic competition ANSWER: c POINTS: 1 DIFFICULTY: Difficulty: […]
Chapter 16 Which of the following market structures is considered a differentiated
Monopolistic Competition 3981 83. Of the following market structures, which are considered imperfectly competitive? I. Perfect competition II. Monopoly III. Monopolistic competition IV. Oligopoly a. III only b. II and III c. III and IV d. II, III, and IV […]
Chapter 16 What is the concentration ratio for Industry A
Monopolistic Competition 3961 40. Refer to Table 16-2. Which industry has the lowest concentration ratio? a. Industry J b. Industry K c. Industry L d. Industry M ANSWER: b POINTS: 1 DIFFICULTY: Difficulty: Challenging LEARNING OBJECTIVES: ECON.MANK.15.78 – LO: 16-1 […]
Chapter 16 A monopolistically competitive market has characteristics
Monopolistic Competition Multiple Choice – Section 00: Introduction 1. Which of the following is a characteristic of monopolistic competition? a. ownership of a key resource by a single firm b. free entry c. identical product d. patents 2. The market […]
Chapter 15 He has one bus which can fit 50 people per tour and each
3932 Monopoly 31. Refer to Table 15-22. The marginal revenue becomes negative with the production of which unit of output? ANSWER: 70th POINTS: 1 DIFFICULTY: Difficulty: Moderate LEARNING OBJECTIVES: ECON.MANK.15.71 – LO: 15-1 NATIONAL STANDARDS: United States – BUSPROG: Analytic […]
Chapter 15 the government chooses to “internalize” the monopoly by owning
Monopoly 3921 78. In many countries, the government chooses to “internalize” the monopoly by owning monopoly providers of goods and services. (In some cases these firms are “nationalized,” and the government actually buys or confiscates firms that operate in monopoly […]
Chapter 15 A monopolist produces an output level where marginal
Monopoly 3901 23. A monopolist produces an output level where marginal revenue equals marginal cost and charges a price where marginal cost equals average total cost. a. True b. False ANSWER: False POINTS: 1 DIFFICULTY: Difficulty: Moderate LEARNING OBJECTIVES: ECON.MANK.15.72 […]
Chapter 15 One problem with government operation of monopolies is that
Monopoly 3881 23. One problem with government operation of monopolies is that a. a benevolent government is likely to be interested in generating profits for political gain. b. monopolies typically have rising average costs. c. the government typically has little […]
Chapter 15 Perfect price discrimination describes a situation in which
Monopoly 3861 81. If a monopolist can practice perfect price discrimination, the monopolist will a. eliminate consumer surplus. b. eliminate deadweight loss. c. maximize profits. d. All of the above are correct. ANSWER: d POINTS: 1 DIFFICULTY: Difficulty: Moderate LEARNING […]
Chapter 15 Charge Single Price 12 All Passengers c Charge
Monopoly 3841 42. Refer to Scenario 15-6. How much additional profit can the concert promoters earn by charging each customer their willingness to pay relative to charging a flat price of $150 per ticket? a. $25,000 b. $50,000 c. $75,000 […]
Chapter 15 When Local Grocery Store Offers Discount Coupons
Monopoly 3821 57. Refer to Scenario 15-4. The profit-maximizing monopolist will earn profits of a. $6,400. b. $3,200. c. $1,600. d. $800. ANSWER: c POINTS: 1 DIFFICULTY: Difficulty: Challenging LEARNING OBJECTIVES: ECON.MANK.15.73 – LO: 15-3 NATIONAL STANDARDS: United States – […]
Chapter 15 Economic welfare is generally measured by
Monopoly 3801 23. A monopoly market a. always maximizes total economic well-being. b. always minimizes consumer surplus. c. generally fails to maximize total economic well-being. d. generally fails to maximize producer surplus. ANSWER: c POINTS: 1 DIFFICULTY: Difficulty: Moderate LEARNING […]
Chapter 15 A reduction in a monopolist’s fixed costs would
Monopoly 3781 188. A reduction in a monopolist‘s fixed costs would a. decrease the profit-maximizing price and increase the profit–maximizing quantity produced. b. increase the profit-maximizing price and decrease the profit–maximizing quantity produced. c. not effect the profit-maximizing price or […]
Chapter 15 The monopolist has total fixed costs of $40 and a constant
Monopoly 3761 Table 15-13 The following table gives information on the price, quantity, and total cost of production for a monopolist. Price Output Total Costs $5 0 $3 $4 5 $8 $3 10 $20 $2 15 $33 $1 20 $53 […]
Chapter 15 What is the marginal revenue from the sale of the 2nd unit
Monopoly 3741 Table 15-4 A monopolist faces the following demand curve: Price Quantity $30 0 $25 2.5 $20 5 $15 7.5 $10 10 $5 12.5 $0 15 110. Refer to Table 15-4. If the monopolist produces 10 units, what is […]
Chapter 15 A profit-maximizing monopolist would incur total costs of
Monopoly 3721 74. Refer to Figure 15-4. The demand curve for a monopoly firm is depicted by curve a. A. b. B. c. C. d. D. ANSWER: b POINTS: 1 DIFFICULTY: Difficulty: Easy LEARNING OBJECTIVES: ECON.MANK.15.72 – LO: 15-2 NATIONAL […]
Chapter 15 The output effect describes the situation when a monopolist sells
Monopoly 3701 32. For a monopoly firm, which of the following equalities is always true? a. price = marginal revenue b. price = average revenue c. price = total revenue d. marginal revenue = marginal cost ANSWER: b POINTS: 1 […]
Chapter 15 Which of the following reasons describes the fundamental barrier
Monopoly 3681 74. Refer to Figure 15–2. Which of the following reasons describes the fundamental barrier to entry for the monopoly in the figure? a. monopoly resources b. government regulation c. the production process d. Both a and b are […]
Chapter 15 the shape of the average total cost curve reveals information about
Monopoly 3661 33. A fundamental source of monopoly market power arises from a. perfectly elastic demand. b. perfectly inelastic demand. c. barriers to entry. d. availability of “free” natural resources, such as water or air. ANSWER: c POINTS: 1 DIFFICULTY: […]
Chapter 15 Benefit Monopoly Lower Prices Wide Variety Similar
Monopoly Multiple Choice – Section 00: Introduction 1. A competitive firm a. and a monopolist are price takers. b. and a monopolist are price makers. c. is a price taker, whereas a monopolist is a price maker. d. is a […]
Chapter 14 If some resources used in the production of a good are only available
Firms in Competitive Markets 3627 64. If some resources used in the production of a good are only available in limited quantities, then the long run market supply curve will be perfectly elastic. a. True b. False ANSWER: False POINTS: […]
Chapter 14 A firm’s incentive to compare marginal revenue and marginal cost
Firms in Competitive Markets 3611 16. A firm’s incentive to compare marginal revenue and marginal cost is an application of the principle that rational people think at the margin. a. True b. False ANSWER: True POINTS: 1 DIFFICULTY: Difficulty: Easy […]
Chapter 14 The long-run supply curve for a competitive industry may be upward
Firms in Competitive Markets 3591 89. In the transition from the short run to the long run, the number of firms in a competitive industry is a. fixed. b. increasing at a constant rate. c. decreasing. d. able to adjust […]
Chapter 14 What is Victor’s opportunity costs of operating his new
Firms in Competitive Markets 3571 50. Which of the following statements is not correct? a. In a long–run equilibrium, marginal firms make zero economic profit. b. To maximize profit, firms should produce at a level of output where price equals […]
Chapter 14 Suppose a competitive market is comprised of firms that face
Firms in Competitive Markets 3551 13. Refer to Figure 14-11. The figure above is for a firm operating in a competitive industry. If there were eight identical firms in the industry, which of the following price-quantity combinations would be on […]
Chapter 14 TVC You Should Home And Read Book d
Firms in Competitive Markets 3531 219. When determining whether to shut down in the short run, a competitive firm should ignore (i) fixed costs. (ii) variable costs. (iii) sunk costs. a. (iii) only b. (i) and (iii) only c. (ii) […]
Chapter 14 a profit-maximizing firm’s losses can be represented
Firms in Competitive Markets 3511 182. Refer to Figure 14-5. When market price is P2, a profit-maximizing firm‘s losses can be represented by the area a. (P4 – P2) × Q2. b. (P2 – P1) × (Q2-Q1). c. At a […]