Chapter 14

Question 1

Monopolies are _________

Answer 1

Price makers

Question 2

Sources of Barriers to enter a monopoly

Answer 2

-Monopoly resources
-Government created monopolies
-Natural monopolies

Question 3

A monopoly is the sole producer in the market. Can choose any price/quantity combination on the demand curve by choosing the quantity that maximizes profit.

Answer 3

True

Question 4

Monopolists produce when MR=MC

Answer 4

True

Question 5

Monopolies produce where marginal revenue intersects ________

Answer 5

Marginal Cost

Question 6

Monopolists produce less than the efficient quantity

Answer 6

True

Question 7

Monopolists generate ___________

Answer 7

Deadweight loss

Question 8

Price Discrimination

Answer 8

-Selling the same good at different prices to different customers

Question 9

Perfect price discrimination

Answer 9

The monopolists charges each costumer their exact willingness to pay.

Question 10

Public Policy towards monopolies

Answer 10

-trying to make monopolized industries more competitive
-Regulating the behavior of monopolies
-turning private monopolies into public enterprises
-Doing no harm