Microeconomics Final Exam

A monopoly will not only charge a higher price, it will also produce ____ output than a competitive market would produce

• More

• Higher

• Less

• Better

The demand curve for the output of a monopolistic firm is equal to

• The marginal revenue for the product in question.

• The market supply curve for the product in question.

• The market demand curve for the product in question.

• The demand curve for a firm in a perfectly competitive market.

A market structure characterized by a few interdependent firms is known as an ________ because decisions by one firm significantly affect the others.

• Monopoly

• Monopolistic Competition

• Oligopoly

• Perfect Competition

A movie theater offers tickets to the general public for $10.

Students can buy tickets for $8. This is an example of

• Deadweight loss

• Price Discrimination

• Market Influence/Power

• Revenue

Why is the demand for fruit less price elastic than the

demand for a boat?

• Consumption of fruit is greater.

• A boat is an inferior good.

• There are more suppliers of fruit than boat manufacturers.

• Fruit takes up less of a consumer’s budget.

• All of the above.

Which pricing and output choices would a monopolist

select?

• Output should be MR = MC and P > MC

• Output should be MR = MC and P = MC

• Output should be MR > MC and P > MC

• Output should be MR < MC and P > MC

A negative externality will exist when

• all consumers receive an equal share of economic

  resources

• spillover costs are given to others not directly involved in

  the consumption or production of a good or service

• the production of a good or service creates a spillover

  benefit

• there is a large unequal distribution of income in a society

Monopoly deadweight loss is caused by

The concept of ________ refers to the situation where a monopolist sets prices above marginal cost, leading to a deadweight loss in consumer surplus.

In monopolistic competition, firms engage in non-price competition, often leading to ________ where they seek to create brand loyalty among consumers.