Question 1

Scenario 15-6
The concert promoters of a heavy-metal band, WeR2Loud, know that there are two types of concert-goers: die-hard fans and casual fans. For a particular WeR2Loud concert, there are 1,000 die-hard fans who will pay $150 for a ticket and 500 casual fans who will pay $50 for a ticket. There are 1,500 seats available at the concert venue. Suppose the cost of putting on the concert is $50,000, which includes the cost of the band, lighting, security, etc.
-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 $50 per ticket?

Accepted Answer

A)  $25,000
B)  $50,000
C)  $75,000
D)  $100,000E) A) and B)
F) B) and C)

Question 2

Average revenue for a monopoly is the total revenue divided by the quantity produced.

Accepted Answer

A) True 
 B)False

Question 3

What are the three main sources of barriers to entry for monopolies?

Accepted Answer

monopoly resources
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Question 4

Figure 15-7 
-Refer to Figure 15-7. In order to maximize profits, the monopolist should produce

Accepted Answer

A)  9 units.
B)  12 units.
C)  15 units.
D)  more than 15 units.E) All of the above
F) A) and B)

Question 5

Antitrust laws allow the government to

Accepted Answer

A)  collect revenues through the antitrust tax.
B)  break up companies.
C)  purchase privately-held companies through eminent domain.
D)  All of the above are correct.E) A) and C)
F) All of the above

Question 6

In the majority of cases where there is a natural monopoly in the United States, the government usually deals with the problem

Accepted Answer

A)  by splitting the natural monopoly into smaller companies.
B)  through regulation.
C)  by turning the natural monopoly into a public enterprise.
D)  by doing nothing.E) None of the above
F) A) and B)

Question 7

By selling hardcover books to die-hard fans and paperback books to less enthusiastic readers, the publisher is able to price discriminate and raise its profits.

Accepted Answer

A) True 
 B)False

Question 8

A government-created monopoly arises when

Accepted Answer

A)  government spending in a certain industry gives rise to monopoly power.
B)  the government exercises its market control by encouraging competition among sellers.
C)  the government gives a firm the exclusive right to sell some good or service.
D)  Both a and c are correct.E) C) and D)
F) B) and C)

Question 9

Figure 15-13 
-Refer to Figure 15-13. A profit-maximizing monopolist would create a deadweight loss to society valued at

Accepted Answer

A)  $12.
B)  $24.
C)  $42.
D)  $84.E) A) and D)
F) B) and C)

Question 10

Table 15-16
A monopolist faces the following demand curve: 
-Refer to Table 15-16. The monopolist has total fixed costs of $40 and a constant marginal cost of $5. At the profit-maximizing level of output, the monopolist's average total cost is

Accepted Answer

A)  $9.00.
B)  $7.50.
C)  $6.74.
D)  $5.82.E) A) and B)
F) A) and C)

Question 11

Table 15-20
A monopolist faces the following demand curve: 
-Refer to Table 15-20. If a monopolist faces a constant marginal cost of $2, how much output should the firm produce in order to maximize profit?

Accepted Answer

A)  2 units
B)  3 units
C)  4 units
D)  5 unitsE) B) and D)
F) B) and C)

Question 12

The monopolist's profit-maximizing quantity of output is determined by the intersection of which of the following two curves?

Accepted Answer

A)  marginal cost and demand
B)  marginal cost and marginal revenue
C)  average total cost and marginal revenue
D)  average variable cost and average revenueE) None of the above
F) B) and C)

Question 13

Table 15-7
Sally owns the only shoe store in town. She has the following cost and revenue information. 
-Refer to Table 15-7. What is the marginal cost of the 8th pair of shoes?

Accepted Answer

A)  $50
B)  $60
C)  $90
D)  $110E) C) and D)
F) A) and D)

Question 14

Figure 15-4 
-Refer to Figure 15-4. The marginal cost curve for a monopoly firm is depicted by curve

Accepted Answer

A)  A.
B)  B.
C)  C.
D)  D.E) B) and C)
F) A) and D)

Question 15

Monopolists can practice price discrimination in all monopoly markets.​

Accepted Answer

A) True 
 B)False

Question 16

Figure 15-15 
-Refer to Figure 15-15. To maximize its profit, a monopolist would choose which of the following outcomes?

Accepted Answer

A)  Q = 30 and P = 30
B)  Q = 30 and P = 60
C)  Q = 45 and P = 45
D)  Q = 60 and P = 30E) A) and D)
F) B) and C)

Question 17

Government intervention is always preferable to doing nothing when reducing the social inefficiencies of monopoly.

Accepted Answer

A) True 
 B)False

Question 18

Scenario 15-6
The concert promoters of a heavy-metal band, WeR2Loud, know that there are two types of concert-goers: die-hard fans and casual fans. For a particular WeR2Loud concert, there are 1,000 die-hard fans who will pay $150 for a ticket and 500 casual fans who will pay $50 for a ticket. There are 1,500 seats available at the concert venue. Suppose the cost of putting on the concert is $50,000, which includes the cost of the band, lighting, security, etc.
-Refer to Scenario 15-6. How much profit will the concert promoters earn if they engage in price discrimination?

Accepted Answer

A)  $100,000
B)  $125,000
C)  $150,000
D)  $175,000E) A) and B)
F) A) and C)

Question 19

Government intervention always reduces monopoly deadweight loss.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following formulas would correctly calculate a monopolist's profit?

Accepted Answer

A)  profit = price - marginal cost
B)  profit = price - average total cost
C)  profit = (price - marginal cost)  × quantity
D)  profit = (price - average total cost)  × quantityE) All of the above
F) B) and D)

Exam 15: Monopoly

What are the three main sources of barriers to entry for monopolies?

Correct Answer
verified
monopoly resources
g...
View Answer

Government intervention is always preferable to doing nothing when reducing the social inefficiencies of monopoly.

Correct Answer
verified

In the majority of cases where there is a natural monopoly in the United States, the government usually deals with the problem

Correct Answer
verified

A government-created monopoly arises when

Correct Answer
verified

Correct Answer
verified

The monopolist's profit-maximizing quantity of output is determined by the intersection of which of the following two curves?

Correct Answer
verified

Government intervention always reduces monopoly deadweight loss.

Correct Answer
verified

Table 15-20 A monopolist faces the following demand curve: -Refer to Table 15-20. If a monopolist faces a constant marginal cost of $2, how much output should the firm produce in order to maximize profit?

Correct Answer
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Correct Answer
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Table 15-7 Sally owns the only shoe store in town. She has the following cost and revenue information. -Refer to Table 15-7. What is the marginal cost of the 8th pair of shoes?

Correct Answer
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Figure 15-7 -Refer to Figure 15-7. In order to maximize profits, the monopolist should produce

Correct Answer
verified

Antitrust laws allow the government to

Correct Answer
verified

Table 15-16 A monopolist faces the following demand curve: -Refer to Table 15-16. The monopolist has total fixed costs of $40 and a constant marginal cost of $5. At the profit-maximizing level of output, the monopolist's average total cost is

Correct Answer
verified

Figure 15-4 -Refer to Figure 15-4. The marginal cost curve for a monopoly firm is depicted by curve

Correct Answer
verified

Average revenue for a monopoly is the total revenue divided by the quantity produced.

Correct Answer
verified

Monopolists can practice price discrimination in all monopoly markets.

Correct Answer
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Which of the following formulas would correctly calculate a monopolist's profit?

Correct Answer
verified

Figure 15-13 -Refer to Figure 15-13. A profit-maximizing monopolist would create a deadweight loss to society valued at

Correct Answer
verified

Figure 15-15 -Refer to Figure 15-15. To maximize its profit, a monopolist would choose which of the following outcomes?

Correct Answer
verified

By selling hardcover books to die-hard fans and paperback books to less enthusiastic readers, the publisher is able to price discriminate and raise its profits.

Correct Answer
verified

Exam 15: Monopoly

What are the three main sources of barriers to entry for monopolies?

Correct Answerverifiedmonopoly resourcesg...View AnswerShow Answer

Government intervention is always preferable to doing nothing when reducing the social inefficiencies of monopoly.

Correct AnswerverifiedShow Answer

In the majority of cases where there is a natural monopoly in the United States, the government usually deals with the problem

Correct AnswerverifiedShow Answer

A government-created monopoly arises when

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The monopolist's profit-maximizing quantity of output is determined by the intersection of which of the following two curves?

Correct AnswerverifiedShow Answer

Government intervention always reduces monopoly deadweight loss.

Correct AnswerverifiedShow Answer

Table 15-20 A monopolist faces the following demand curve: -Refer to Table 15-20. If a monopolist faces a constant marginal cost of $2, how much output should the firm produce in order to maximize profit?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Table 15-7 Sally owns the only shoe store in town. She has the following cost and revenue information. -Refer to Table 15-7. What is the marginal cost of the 8th pair of shoes?

Correct AnswerverifiedShow Answer

Figure 15-7 -Refer to Figure 15-7. In order to maximize profits, the monopolist should produce

Correct AnswerverifiedShow Answer

Antitrust laws allow the government to

Correct AnswerverifiedShow Answer

Table 15-16 A monopolist faces the following demand curve: -Refer to Table 15-16. The monopolist has total fixed costs of $40 and a constant marginal cost of $5. At the profit-maximizing level of output, the monopolist's average total cost is

Correct AnswerverifiedShow Answer

Figure 15-4 -Refer to Figure 15-4. The marginal cost curve for a monopoly firm is depicted by curve

Correct AnswerverifiedShow Answer

Average revenue for a monopoly is the total revenue divided by the quantity produced.

Correct AnswerverifiedShow Answer

Monopolists can practice price discrimination in all monopoly markets.​

Correct AnswerverifiedShow Answer

Which of the following formulas would correctly calculate a monopolist's profit?

Correct AnswerverifiedShow Answer

Figure 15-13 -Refer to Figure 15-13. A profit-maximizing monopolist would create a deadweight loss to society valued at

Correct AnswerverifiedShow Answer

Figure 15-15 -Refer to Figure 15-15. To maximize its profit, a monopolist would choose which of the following outcomes?

Correct AnswerverifiedShow Answer

By selling hardcover books to die-hard fans and paperback books to less enthusiastic readers, the publisher is able to price discriminate and raise its profits.

Correct AnswerverifiedShow Answer

Correct Answer
verified
monopoly resources
g...
View Answer

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Monopolists can practice price discrimination in all monopoly markets.

Correct Answer
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