10e_Test Bank_Chapter 14_Final

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1、File:Chapter14MonopolyandMonopolisticCompetitionTrue/False[QUESTION]1.Sincemarginalrevenueislessthanpriceforamonopolist,amonopolistmaximizesprofitsbyequatingmarginalrevenueandmarginalcost,notpriceandmarginalcost.Ans:TrueAACSB:ReflectiveThinkingBloom’s:RememberDiffic

2、ulty:01EasyLearningObjective:14-02Topic:AModelofMonopolyFeedback:Priceequalsmarginalrevenueforpurelycompetitivefirmsonly,notformonopolies.[QUESTION]2.Theprofit-maximizingoutputlevelforamonopolistoccurswheremarginalrevenueequalsmarginalcost.Ans:TrueAACSB:ReflectiveTh

3、inkingBloom’s:RememberDifficulty:01EasyLearningObjective:14-02Topic:AModelofMonopolyFeedback:Allfirms,monopoliesorotherwise,maximizeprofitsbyequatingmarginalcostandmarginalrevenue.[QUESTION]3.Aprofit-maximizingmonopolistwillalwayssetpriceequaltomarginalcost.Ans:Fals

4、eAACSB:ReflectiveThinkingBloom’s:RememberDifficulty:01EasyLearningObjective:14-02Topic:AModelofMonopolyFeedback:Sincemarginalrevenueisalwayslessthanpriceundermonopoly,pricewillneverequalmarginalcostforaprofit-maximizingmonopolist.[QUESTION]4.Amonopolistwillalwaysmak

5、eaprofitintheshortrun.Ans:FalseAACSB:ReflectiveThinkingBloom’s:RememberDifficulty:01EasyLearningObjective:14-02Topic:AModelofMonopoly©2017byMcGraw-HillEducation. Thisisproprietarymaterialsolelyforauthorizedinstructoruse.Notauthorizedforsaleordistributioninanymanner.

6、 Thisdocumentmaynotbecopied,scanned,duplicated,forwarded,distributed,orpostedonawebsite,inwholeorpart. Feedback:Amonopolist,likeanyotherfirm,makesaprofitonlyifpriceexceedsaveragetotalcost.[QUESTION]5.Aprice-discriminatingmonopolistwillmakelessinprofitthanwillonethat

7、doesnotprice-discriminate.Ans:FalseAACSB:ReflectiveThinkingBloom’s:RememberDifficulty:01EasyLearningObjective:14-03Topic:WelfareLossfromMonopolyFeedback:Pricediscriminationallowsamonopolisttochargeeachconsumerthemaximumpricethatcustomeriswillingtopayforaproduct.Anon

8、-price-discriminatingmonopolistmustchargethesamepricetoeveryoneandearnsasmallerprofitasaresult.[QUESTION]6.Ifamonopolistcanpricediscrimina