The long-run equilibrium price-output combination for a monopolist is economically inefficient because:
a. it does not operate on the minimum point of its marginal-cost curve.
b. it does not produce the level of output at which price equals marginal cost.
c. consumer surplus is maximized but not producer surplus.
d. producer surplus is maximized but not consumer surplus.
e. it operates on the downward sloping portion of the average-total-cost curve.
QUESTION 2Monopolistic competition differs from perfect competition only with regard to the number of firms participating in the market.
a. True
b. False
Indicate whether the statement is true or false
QUESTION 3The IMF mostly receives its funds from:
a. the subscription fees paid by the member nations.
b. selling of bonds.
c. the loans given by the World Bank.
d. the central banks of the major industrialized nations.
e. the gold reserves available with the Fed.
QUESTION 4Post deregulation, airlines attempted to maintain their earlier profit levels by instituting price discrimination in such forms as advance purchase ticket restrictions and frequent-flyer mileage programs. These methods generally did not succeed in maintaining those profit levels.
Indicate whether the statement is true or false
QUESTION 5Compared with a perfectly competitive market with similar cost conditions, a monopolist will have:
a. a higher output and a lower price.
b. a lower output and a lower price.
c. a higher output and a lower price.
d. a lower output and a higher price.
e. equal output and a higher price.
QUESTION 6Monopolistic competition is more similar to monopoly than any other industry model.
a. True
b. False
Indicate whether the statement is true or false
Quick Reply
