Question 1

Which would definitely not be an example of price discrimination?

Accepted Answer

A)   A theater charges children less than adults for a movie.
B)   Universities charge higher tuition for out-of-state residents.
C)   A doctor charges for services according to the income of patients.
D)   An electric power company charges less for electricity used during hours when production costs are lower.E) A) and B)
F) A) and C)

Question 2

Some firms in the technology sector have achieved economies of scale because costs have been reduced by:

Accepted Answer

A)   price discrimination.
B)   socially optimal pricing.
C)   fair return pricing.
D)   simultaneous consumption.E) A) and D)
F) A) and C)

Question 3

Assume the owners of the only gambling casino in Wisconsin spend large sums of money lobbying state government officials to protect their gambling monopoly.Economists refer to these expenditures as:

Accepted Answer

A)   rent-seeking.
B)   socially optimal pricing.
C)   perfect price discrimination.
D)   diseconomies of scale in production.E) A) and B)
F) B) and D)

Question 4

In the Microsoft antitrust case,a federal court ruled to break up the company on the basis of the:

Accepted Answer

A)   firm's market behavior.
B)   firm's large market share.
C)   size of the corporation.
D)   firm's effect on the stock market.E) B) and C)
F) A) and B)

Question 5

Price discrimination is more common in service industries because:

Accepted Answer

A)   low-price buyers will find it virtually impossible to resell the products of such industries to high-price buyers.
B)   the costs of providing such industries' products to different groups of buyers vary dramatically.
C)   the price elasticity of demand is the same for all groups of buyers in these industries.
D)   all firms in these industries have significant monopoly power over price.E) B) and C)
F) A) and C)

Question 6

A monopolist will always charge the highest price it can get.

Accepted Answer

A) True 
 B)False

Question 7

A firm sells 99 units of output when price equals $10 and 100 units of output when price equals $9.Its marginal revenue for the 100th unit of output is negative.

Accepted Answer

A) True 
 B)False

Question 8

Which is a barrier to entry?

Accepted Answer

A)   Close substitutes
B)   Diseconomies of scale
C)   Government licensing
D)   Price-taking behaviorE) B) and C)
F) C) and D)

Question 9

Which is one of the conditions that must be realized before a seller finds that price discrimination is workable?

Accepted Answer

A)   The demand for the product is perfectly elastic so any price can be charged for the product.
B)   The seller must be able to segregate buyers based on a willingness to pay.
C)   The buyer must be able to resell the product at a higher price to other consumers.
D)   The product must be a service because demand is more elastic for services.E) B) and C)
F) All of the above

Question 10

X-inefficiency is said to occur when a firm's:

Accepted Answer

A)   average costs of producing any output are greater than the minimum possible average costs.
B)   marginal costs of producing any output are greater than the minimum possible total costs.
C)   total costs of producing any output are greater than the minimum possible average costs.
D)   short-run costs of producing any output are greater than the long-run costs.E) A) and D)
F) B) and C)

Exam 8: Pure Monopoly

A monopolist will always charge the highest price it can get.

Correct Answer
verified

In the Microsoft antitrust case,a federal court ruled to break up the company on the basis of the:

Correct Answer
verified

X-inefficiency is said to occur when a firm's:

Correct Answer
verified

Which would definitely not be an example of price discrimination?

Correct Answer
verified

Which is a barrier to entry?

Correct Answer
verified

Price discrimination is more common in service industries because:

Correct Answer
verified

Which is one of the conditions that must be realized before a seller finds that price discrimination is workable?

Correct Answer
verified

Some firms in the technology sector have achieved economies of scale because costs have been reduced by:

Correct Answer
verified

A firm sells 99 units of output when price equals $10 and 100 units of output when price equals $9.Its marginal revenue for the 100th unit of output is negative.

Correct Answer
verified

Assume the owners of the only gambling casino in Wisconsin spend large sums of money lobbying state government officials to protect their gambling monopoly.Economists refer to these expenditures as:

Correct Answer
verified

Exam 8: Pure Monopoly

A monopolist will always charge the highest price it can get.

Correct AnswerverifiedShow Answer

In the Microsoft antitrust case,a federal court ruled to break up the company on the basis of the:

Correct AnswerverifiedShow Answer

X-inefficiency is said to occur when a firm's:

Correct AnswerverifiedShow Answer

Which would definitely not be an example of price discrimination?

Correct AnswerverifiedShow Answer

Which is a barrier to entry?

Correct AnswerverifiedShow Answer

Price discrimination is more common in service industries because:

Correct AnswerverifiedShow Answer

Which is one of the conditions that must be realized before a seller finds that price discrimination is workable?

Correct AnswerverifiedShow Answer

Some firms in the technology sector have achieved economies of scale because costs have been reduced by:

Correct AnswerverifiedShow Answer

A firm sells 99 units of output when price equals $10 and 100 units of output when price equals $9.Its marginal revenue for the 100th unit of output is negative.

Correct AnswerverifiedShow Answer

Assume the owners of the only gambling casino in Wisconsin spend large sums of money lobbying state government officials to protect their gambling monopoly.Economists refer to these expenditures as:

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
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