All wordy workshop questions

Question 1

In a perfectly competitive and monopolistic industry the demand curve is downwards sloping - T or F

Answer 1

F - Both are downwards

Question 2

Perfectly competitive firms have no control over the price they charge - T or F

Answer 2

True

Question 3

for natural monopolies AC declines as the supply rises - T or F

Answer 3

True

Question 4

A single-price profit-maximising monopolist will always price above the Marginal cost of production - T or F

Answer 4

T

Question 5

If a monopolist could perfectly price discriminate:
a. The marginal revenue curve and the demand curve would coincide.
b. The marginal revenue curve and the marginal cost curve would coincide.
c. Every consumer would pay a different price.
d. Marginal revenue would become negative at some output level.
e. The resulting pattern of exchange would still be socially inefficient.

Answer 5

A