Question 28

1pts

A monopoly can continue to generate economic profits in the long run because

Group of answer choices

there is some barrier to entry to that market.

the monopolist is financially powerful.

antitrust laws eliminate competitors for a specified number of years.

potential competitors sometimes do not notice the profits.

Flag this Question

Question 29

1pts

What do economists call the practice of selling the same good at different prices to different customers?

Group of answer choices

collusion

predatory pricing

compensating differential

price discrimination

Flag this Question

Question 30

1pts

For a firm to price discriminate

Group of answer choices

it must have some market power to influence the price of the good.

consumers must tell the firm what they are willing to pay for the product.

it must be a natural monopoly.

it must be regulated by the government.

Flag this Question

Question 31

1pts

Price discrimination requires the firm to be able to

Group of answer choices

differentiate between different units of its product.

engage in arbitrage.

separate customers according to their willingness to pay.

use coupons.

Flag this Question

Question 32

1pts

Financial aid to college students, quantity discounts, and senior citizen discounts are all examples of

Group of answer choices

price discrimination.

non-profit pricing strategies.

competitive pricing.

non-price competition.

Flag this Question

Question 33

1pts

A collection of statutes aimed at curbing monopoly power is called

Group of answer choices

the 14th amendment.

antitrust law.

the Clayton Act.

the Sherman Act.

Flag this Question

Question 34

1pts

The first major piece of antitrust legislation was the

Group of answer choices

Reagan-Bush Act.

Clinton-Gore Act.

Sherman Act.

Clayton Act.

Flag this Question

Question 35

1pts

Which of the following is an example of public ownership of a monopoly?

Group of answer choices

Microsoft

DeBeers

U.S. Postal Service

AT&T

Flag this Question

Question 36

1pts

Which of the following is a characteristic of monopolistic competition?

Group of answer choices

free entry

patents

ownership of a key resource by a single firm

identical product

Flag this Question

Question 37

1pts

A monopolistically competitive market has characteristics that are similar to

Group of answer choices

both a monopoly and a competitive firm.

a monopoly only.

a competitive firm only.

neither a monopoly nor a competitive firm.

Flag this Question

Question 38

1pts

The two types of imperfectly competitive markets are

Group of answer choices

monopoly and monopolistic competition.

monopolistic competition and cartels.

monopolistic competition and oligopoly.

monopoly and oligopoly.

Flag this Question

Question 39

1pts

The commercial jetliner industry consisting of only two large firms Boeing and Airbus would best be described as a(n)

Group of answer choices

monopoly.

oligopoly.

monopolistically competitive market.

perfectly competitive market.

Flag this Question

Question 40

1pts

Which of the following products isleastlikely to be sold in a monopolistically competitive market?

Group of answer choices

video games

cotton

beer

breakfast cereal

Flag this Question

Question 41

1pts

Product differentiation causes the seller of a good to face what type of demand curve?

Group of answer choices

upward sloping

horizontal

downward sloping

vertical

Flag this Question

Question 42

1pts

To maximize its profit, in the short run a monopolistically competitive firm

Group of answer choices

takes the price as given and choses the quantity, just as a colluding oligopolist does.

chooses its quantity and price, just as a competitive firm does.

takes the price as given and choses the quantity, just as a competitive firm does.

chooses its quantity and price, just as a monopoly does.

Flag this Question

Question 43

1pts

For a profit-maximizing monopolistically competitive firm, price exceeds marginal cost in

Group of answer choices

the long run but not in the short run.

both the short run and the long run.

the short run but not in the long run.

neither the short run nor the long run.

Flag this Question

Question 44

1pts

In a long-run equilibrium, a firm in a monopolistically competitive market operates

Group of answer choices

where marginal revenue is zero.

where marginal revenue is negative.

on the declining portion of its average total cost curve.

on the rising portion of its average total cost curve.

Flag this Question

Question 45

1pts

When a new firm enters a monopolistically competitive market, the individual demand curves faced by all existing firms in that market will

Group of answer choices

shift to the right.

shift in a direction that is unpredictable without further information.

shift to the left.

remain unchanged. It is the supply curve that will shift.

Flag this Question

Question 46

1pts

Which of the following is true with regard to monopolistically competitive firms' scale of production and pricing decisions? Monopolistically competitive firms produce

Group of answer choices

with excess capacity and charge a price above marginal cost.

at the efficient scale and charge a price equal to marginal cost.

with excess capacity and charge a price equal to marginal cost.

at the efficient scale and charge a price above marginal cost.

Flag this Question

Question 47

1pts

Firms that spend the greatest percentage of their revenue on advertising tend to be firms that sell

Group of answer choices

industrial products.

identical products.

agricultural products.

highly differentiated consumer goods.

Flag this Question

Question 48

1pts

Which of the following firms has theleastincentive to advertise?

Group of answer choices

a manufacturer of home heating and air conditioning

a wholesaler of crude oil

a manufacturer of breakfast cereal

a manufacturer of soft drink

Flag this Question

Question 49

1pts

Critics of advertising argue that advertising

Group of answer choices

gives information about the quality of the product that is being advertised.

enhances competition.

benefits television viewers who enjoy TV commercials.

creates desires that otherwise might not exist.

Flag this Question

Question 50

1pts

When quality cannot be easily judged in advance, what provides consumers with information about the quality of a product?

Group of answer choices

a brand name

a tie-in

the quantity available for sale

the amount of deadweight loss

Flag this Question

Question 51

1pts

The market for hand tools (such as hammers and screwdrivers) is dominated by two large firms - Stanly Black and Decker, and Craftsman. This market is described as

Group of answer choices

an oligopoly.

a mopolistically competitive market.

a monopoly.

a perfectly competitive market.

Flag this Question

Question 52

1pts

The simplest type of oligopoly is

Group of answer choices

a monopoly.

oligopolistic competition.

a duopoly.

monopolistic competition.

Flag this Question

Question 53

1pts

An agreement among firms in a market about quantities to produce or prices to charge is called

Group of answer choices

collusion.

a strategic situation.

excess capacity.

tying.

Flag this Question

Question 54

1pts

If oligopolists engage in collusion and successfully form a cartel, the market outcome is

Group of answer choices

known as Nash equilibrium.

efficient because cooperation improves efficiency.

the same as if it were served by a monopoly.

the same as if it were served by competitive firms.

Flag this Question

Question 55

1pts

A distinguishing feature of an oligopolistic industry is the tension between

Group of answer choices

short-run decisions and long-run decisions.

cooperation and self-interest.

producing a small amount of output and charging a price above marginal cost.

profit maximization and cost minimization.