ECON 110 Read & Interact Schiller & Gephardt Chapter 7 solutions complete answers

ECON 110 Read & Interact Schiller & Gephardt Chapter 7 solutions complete answers 

 

When evaluating whether or not monopolies are bad for society, market _______ per se is not the problem. What counts is market _______.

 

A monopoly subject to potential entry if prices or profits increase because of modest entry barriers is called a(n)

 

Temporary price reductions designed to drive out competition is known as

 

True or false: When evaluating whether or not monopolies are bad for society, market behavior per se is not the problem; what counts is market structure.

 

A monopoly subject to potential entry if prices or profits increase because of modest entry barriers is called a   market.

 

An industry in which one firm can achieve economies of scale over the entire range of market supply is a(n)   monopoly.

 

When a multiplex movie theater achieves economies of scale by driving smaller theaters out of business, it   (always/rarely) lowers ticket prices.

 

When evaluating the scale of production,   and size do not necessarily go hand in hand.

 

The ______ argument in favor of monopoly is based on the idea that greater profit encourages more entrepreneurial activity.

 

An industry in which one firm can achieve economies of scale over the entire range of market supply is a(n)

 

A market made up of many firms, each of which has some distinct brand image, is called   competition.

 

A market made up of many firms, each of which has some distinct brand image, is called

 

In _______, the firm's profit-maximizing quantity is where marginal revenue equals marginal cost.

 

When the government gives a single firm the exclusive right to produce a particular good in a specific market, it creates a barrier to entry known as

 

An example of an entrance barrier occurs when corporations force consumers to purchase complementary products. This practice is often called

 

An example in the text of exclusive licensing as a barrier to entry occurred when _____. 

 

In _______, the firm's profit-maximizing quantity is where price equals marginal cost.

 

Which of the following is an example in the text of government franchising as a barrier to entry?

 

An example in the text of bundled products as a barrier to entry occurred when

 

The practice of a monopolist suing a potential competitor to stop entry into the market is known as:

 

Barriers to entry prevent competitive firms from entering the market and therefore preserve _______ in the monopoly market.

 

Barriers to entry contribute to _____ status.

 

To sell 4 units of output, marginal revenue is $102 and marginal cost is $60. To sell 5 units of output, marginal revenue is $82 and marginal cost is $70. To sell 6 units of output, marginal revenue is $62 and marginal cost is $80. What quantity should be produced?

 

Compared to a perfect competitor, a monopolist finds it profitable to charge a ______ price and supply a ______ quantity.

 

The selection of the short-run rate of output with existing plants and equipment is known as the short-run   decision.

 

Regardless of industry structure, a firm positions itself in the best profit-maximizing level of production if that amount of output reflects the point at which the last unit's marginal revenue is equal to its marginal cost. Why?

 

Once a monopolist identifies the profit-maximizing rate of output, the _______ curve shows how much consumers are willing to pay for that specific quantity of output.

 

Can a monopolist charge whatever price it wants?

 

In a monopoly, because the demand curve is downward sloping, ______ is less than the price.

 

A firm gets a(n)   when the government grants an exclusive right to the firm to produce or license a product.

 

Compared to perfectly competitive firms, monopolists:

 

If the government grants an exclusive right to produce or license a product this is known as:

 

If a firm has the ability to alter the market price of a good or service, then it

 

The market demand curve is _____ and the demand curve facing a perfectly competitive firm is _____.

 

If the government grants an exclusive right to produce of license a product this is known as:

 

A monopoly exists when a single firm is the _____ producer of a product.

 

A monopolist has market       because it controls the quantity produced and thus has some control over the price.

 

A firm that has the ability to alter the market price of a good is said to have:

 

      firms are always under pressure from other firms in the industry to hold down costs.

 

What is the difference in demand between a perfectly competitive firm and market demand?

 

In a       (Enter one word), the demand curve for a firm is also the demand curve for the industry.

 

A firm gets a       when the government grants an exclusive right to the firm to produce or license a product.

 

Which of the following exists when a single firm is the sole producer of a product?

 

The change in total revenue given a change in quantity sold is called       revenue.

 

Which of the following are reasons that a monopolist is considered to have market power?

 

Marginal revenue for the perfectly competitive seller is ______ price, whereas for the monopolist it is ______ price.

 

Compared to perfectly competitive firms monopolist:

 

With a downward-sloping demand curve, a monopolist can only increase sales by charging a ______ price.

 

A monopolist faces a downward-sloping ______ curve.

 

Calculate marginal revenue if the monopolist increases sales from A to B.

 

Marginal revenue is less than price at every unit of output because the monopolist

 

Marginal revenue is the change in _______ divided by the change in output.

 

In a monopoly, ______ is less than the price for every unit of output except the first.

 

Marginal revenue for the perfectly competitive seller is equal to _______, whereas for the monopolist it is less than _______.

 

A perfectly competitive firm _______ the market price. A monopolist _______ the market price.

 

With a downward-sloping demand curve, how can a monopolist increase sales?

 

A monopolist uses the rule of marginal revenue equals marginal cost to determine the profit-maximizing       (Enter one word).

 

Calculate marginal revenue if the monopolist increases sales from D to E.

 

Which of the following describes why marginal revenue is less than price under a monopoly?

 

In a monopoly, marginal revenue is less than price for every unit of output except which one?

 

A monopolist will maximize profits when:

 

A perfectly competitive firm is a price taker, whereas a monopolist _______ the price.

 

The selection of the short-run rate of output with existing plants and equipment is known as the

 

To find the best rate of output,a monopolist should follow the profit-maximization rule and produce at a rate of output where       revenue equals       cost.

 

The monopolist wants to sell a price-quantity combination where marginal _____ is equal to marginal _____.

 

Calculate marginal revenue if the monopolist increases sales from B to C.

 

The ability of a monopolist to charge a high price is limited by the

 

At output levels before MR=MC, marginal ______ is higher in comparison to marginal ______, and at output levels after MR=MC, marginal ______ is higher than marginal ______.

 

Once a monopolist identifies the profit maximizing rate of output, the _______ curve shows how much consumers are willing to pay for that specific quantity of output.

 

The selection of the short-run rate of output with existing plants and equipment is known as the short run       decision.

 

A firm is producing 25 units of output. At the 24th unit of output, marginal revenue is $5, and marginal cost is $4; at the 25th unit of output, marginal revenue is $4.50, and marginal cost is $4.50; at the 26th unit of output, marginal revenue is $4, and marginal cost is $5. Is the firm producing the profit-maximizing level at the 25th level of output?

 

A monopolist will produce up to the output at which:

 

How is total profit calculated?

 

A monopolist finds it profitable to charge a(n)       price and supply a smaller quantity, compared with competitive firms.

 

Can a monopolist charge whatever price they want?

 

Barriers to entry prevent competitive firms from entering the market and therefore preserves _______ in the monopoly market.

 

What is the term for obstacles that prohibit firms from entering an industry?

 

To sell 4 units of output, marginal revenue is $102 and marginal cost is $60. To sell 5 units of output, marginal revenue is $82 and marginal cost is $70. To sell 6 units of output, marginal revenue will be $62 and marginal cost is $80. What quantity should be produced?

 

The highest barriers to entry can be found in the ______ market structure. The lowest barriers to entry can be found with ______.

 

______ profit is found by multiplying per-unit profit at the profit-maximizing output (the difference between price and average total cost) by the profit-maximizing output.

 

The _______ industry was an example of an industry that achieved monopoly power through patents.

 

If profits exist in a perfectly competitive industry, profit-seeking entrepreneurs enter causing industry output to _______ and _______ market prices. As compared to a monopoly, perfectly competitive industry profits are _______.

 

Patents and patent laws aim to protect a firm from ______.

 

_______ prevent(s) competitive firms from entering the market and therefore preserves profits in the monopoly market.

 

            is the use of lawsuits or potential lawsuits as a barrier to entry. (Enter one word in each blank.)

 

Barriers to       (Enter one word) are obstacles that make it difficult or impossible for would-be producers to enter a particular market.

 

An example in the text of exclusive licensing as a barrier to entry was when _____. 

 

Which form of industry is most likely to have the highest barriers to entry?

 

An example in the text of bundled products as a barrier to entry was when

 

The instant photography camera industry was an example of an industry that achieved monopoly power through ______ on instant-photography cameras.

 

An example in the text of government franchising as a barrier to entry was when

 

A patent is a(n) _______ protecting a firm from potential competition.

 

When a monopolist sues a potential competitor to stop entry into the market it is known as:

 

In _______, high profits attract new suppliers.

 

When Nintendo forbade game creators from writing software for competing firms, Nintendo created a monopoly through

 

A duopoly has _______ firms rather than the one firm of a monopoly. In order to maximize industry profits a duopoly should attempt to behave like _______.

 

An example of an entrance barrier is when corporations force consumers to purchase complementary products, this is often referred to as

 

In an      , several firms control the market. (Insert one word in the blank.)

 

When the government gives a single firm the exclusive right to produce a particular good in a specific market, this is a barrier to entry known as

 

A market made up of many firms each of which has some distinct brand image is called       competition.

 

In _______, the firm’s profit maximizing quantity is where marginal revenue equals marginal cost.

 

In a duopoly there are two firms rather than one. In order to maximize industry profits how might these two firms choose to behave?

 

How many firms control the market in an oligopoly?

 

The offer (supply) of goods at prices equal to their marginal cost is known as

 

Patents provide a firm with a ______ position for the life of the patent.

 

In _______, barriers to entry are erected to exclude potential competition.

 

Only ________ exhibits marginal cost pricing.

 

Which of the following are arguments that demonstrate monopolies can provide benefits to society?

 

Which of the following are reasons that many monopolies conduct research and development?

 

It has been argued that greater profit prizes will stimulate more       activity.

 

Which of the following is considered a barrier to entry protecting a firm from potential competition?

 

A firm’s minimum average total costs decline with increases in the size of the plant when ______ exist.

 

Which of the following market structures exhibits marginal cost pricing?

 

Which of these statements about efficiency is always true for a monopoly?

 

Which of the following could be arguments in favor of market power (and monopolies) providing benefits to society?

 

With economies of scale, _____. 

 

Match the following.

 

An industry in which one firm can achieve economies of scale over the entire range of market supply is a       monopoly.

 

The ______ argument in favor of monopoly is based on the idea that greater profit encourage more entrepreneurial activity.

 

Why are some industries permitted to operate as natural monopolies instead of encouraging competition?

 

The concept that a large firm can potentially produce goods at a lower unit (average) cost than a small firm is known as:

 

Local phone calls, natural gas distribution, wireless communication, and cable television are all examples of

 

True or false: Monopolies generate efficiency; efficiency and size necessarily go hand in hand.

 

The       regulates some natural monopolies to guard against excessively high prices to consumers and to ensure that the benefits of increased efficiency are shared with consumers.

 

When a multiplex movie theater achieves economies of scale by driving smaller theaters out of business, they       lower ticket prices. (Choose between rarely/always)

 

A monopoly subject to potential entry if prices or profits increase because of modest entry barriers is a called a       market.

 

True or false: When evaluating whether or not monopolies are bad for society, market behavior per se is not the problem, what counts is market structure.

 

Natural monopolies are permitted because they are able to achieve ______ that cannot be achieved by a number of smaller competing firms.

 

A monopoly will often use _______, a sharp but temporary cut in prices, for the chance to attain market share and in order to put up barriers against would-be competitors.

 

A good example of a natural monopoly is

 

The government regulates some natural monopolies to

 

When evaluating whether or not monopolies are bad for society, market _______ per se is not the problem, what counts is market _______.

 

A sharp but temporary cut in prices to drive a new entrant out of the market is known as

 

A ________ is when the government grants an exclusive right to produce or license a product.

 

What is the shape of the demand curve for a monopolist?

 

Marginal revenue is the change in _______ revenue when one more unit is sold.

 

Marginal revenue for a perfectly competitive firm is equal to ________, while for a monopolist marginal revenue is less than price.

 

In a monopoly, because the demand curve is downward-sloping, ______ is less than the price.

 

According to the profit-maximizing rule, a monopolist should produce a rate of output where

 

For a monopolist, price is ______ marginal revenue.

 

Economic profit for a monopolist can be calculated by _____ the difference between P and ATC by quantity.

 

For a monopolist, marginal revenue is ______ price.

 

A monopolist computes total profits by multiplying _______ by the quantity sold.

 

In _______, the firm charges a price that is equal to marginal cost.

 

In _______, the firm’s profit maximizing quantity is where price equals marginal cost.

 

Competitive markets tend toward _______. This is particularly important to consumers because it informs consumers of the true opportunity cost of these goods.

 

In _______, the firm charges a price that is greater than marginal cost.

 

In _______, high prices and profits signal consumers’ demand for more output.

 

What are economies of scale?

 

If economies of scale are extensive, then a _________ will be able to supply an entire market at a lower cost than could a number of competing firms.

 

What term is used to describe declining average total costs with added plant and equipment size?

 

When a multiplex movie theater achieves economies of scale by driving smaller theaters out of business they ________ lower ticket prices.

 

An industry in which each firm’s lowest ATC is substantially higher than that of a single seller is an inefficient one and allows a single, low-cost production seller to be efficient describes a:

 

A __________ is the only seller of a good in a particular market.

 

The change in total revenue when one more unit is sold is called _____________ revenue.

 

How much will a monopolist produce?

 

As compared to a monopoly, a perfectly competitive industry output is ____, prices are ______, and profits are _____.

 

Which of the following might be used to protect a monopoly from competition?

 

Which of the following is likely to be a monopolist?

 

Monopolists are price 

 

For a monopolist, the demand curve facing the firm is 

 

Since a monopoly has market power 

 

In order to sell one additional unit of output, a profit-maximizing monopolist must

 

For a monopolist, after the first unit of output, marginal revenue is always

 

Suppose a monopoly firm produces software and can sell 10 items per month at a price of $50 each. In order to increase sales by one item per month, the monopolist must lower the price of its software by $1 to $49. The marginal revenue of the 11th item is 

 

Which of the following do a monopolist and a competitive firm generally have in common?

 

For a monopoly in long-run equilibrium, economic profits are likely to be

 

Which of the following statements is true, assuming the same cost and demand conditions?

 

Which of the following is consistent with a monopoly industry?

 

Suppose a market is dominated by three firms. This type of market is called

 

Which market structure is characterized by a few interdependent firms?

 

Suppose a market has many firms and each firm has some brand image. This type of market is likely

 

An industry in which one firm can achieve economies of scale over the entire range of output is referred to 

 

If a monopoly’s marginal revenue for a product is $25 and the marginal cost is $18, the firm should do which of the following?

 

An industry structure with many firms, each of which has some distinct brand image, is called