Monopoly is a market structure where:
A)there is a single seller producing a unique product.
B)a few firms dominate the market.
C)many firms produce differentiated products.
D)many firms produce identical products.

The demand curve for a monopolist is:
A)perfectly elastic.
B)not relevant since the monopolist has control over price.
C)the same as the market demand curve.
D)perfectly inelastic.

A monopolist will charge a price that:
A)equals the marginal revenue.
B)is less than the marginal cost.
C)exceeds the marginal cost.
D)equals the marginal cost of the product.

The monopolist's marginal revenue is less than price because:
A)the monopolist's supply curve is below its marginal revenue curve.
B)total revenue is increasing.
C)the selling price is constant.
D)the monopolist must lower the price of all units in order to sell and additional unit.

If MR < MC, the monopolist should:
A)decrease production.
B)increase production.
C)maintain the same level of production.
D)stop producing.

<a onClick="'/olcweb/cgi/pluginpop.cgi?it=gif::::/olc/dl/107057/Image119.gif','popWin', 'width=257,height=257,resizable,scrollbars');" href="#"><img valign="absmiddle" height="16" width="16" border="0" src="/olcweb/styles/shared/linkicons/image.gif"> (2.0K)</a> Refer to the graph above. The profit-maximizing monopolist will produce output:

The welfare loss triangle shows:
A)the welfare costs of monopoly in terms of consumer and producer surplus.
B)the welfare costs of monopoly in terms of money spent on political influence.
C)the welfare costs of monopoly in terms of income redistribution.
D)the welfare loss of monopoly in terms of social fairness.

If the quantity demanded at a price of $10 is 2000 and the quantity demanded at a price of $8 is 2400, then a price-discriminating monopolist would earn higher profit by:
A)charging all consumers the higher price of $10 and selling 2000 units.
B)charging all consumers $8 in order to increase quantity sold to 2400.
C)selling 2000 units for $8 each, then selling an additional 400 units for $10 each.
D)selling 2000 units for $10 each, then selling an additional 400 units for $8 each.

Average total costs always exceed marginal costs MC for:
A)a natural monopoly.
B)a perfectly price-discriminating monopolist.
C)all firms.
D)no firms.

Patents are given on new inventions to:
A)help firms earn positive economic profit.
B)encourage firms to devote resources to the development of new inventions.
C)prevent firms from earning positive economic profits.
D)guarantee that the products created by new inventions are affordable to consumers.