A) must lower price on all previous units to sell an additional unit of output.
B) is a price taker.
C) finds that its marginal revenue and price are the same for the first unit of the good it sells.
D) necessarily faces a perfectly inelastic demand curve.
E) a and c
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A) it must raise its price to signal consumers that its product is now a more important part of their budget, and they will purchase more.
B) like a competitive firm, it can simply make more output available and not lower price.
C) it must lower price.
D) it can raise price and not worry that sales will decrease.
E) a and d
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A) perfectly inelastic.
B) the market demand curve.
C) perfectly elastic.
D) necessarily unit elastic.
E) none of the above
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A) a cellular telephone company charging lower rates to weekend callers than weekday callers
B) a gas station charging less per gallon to customers who pay cash than customers who use a credit card
C) an auto insurance company charging a higher premium to a seventeen year old boy with a driving record that includes three accidents than the premium charged to a middle-aged driver with a clean driving record
D) a private attorney charging higher fees to clients receiving special services than clients receiving regular services
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A) The perfectly competitive firm produces a level of output at which P=MC.
B) The single-price monopolist produces a level of output at which P > MC.
C) The perfectly price-discriminating monopolist produces a level of output at which P>MC.
D) a and b
E) all of the above
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A) the marginal revenue curve lies below the demand curve.
B) the marginal revenue curve and demand curve are the same.
C) the marginal revenue curve lies above the demand curve.
D) marginal revenue equals price.
E) c and d
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A) believes that the demand of individuals in city X is relatively inelastic.
B) believes that the demand of individuals in city X is relatively elastic.
C) wants to shift the demand of individuals in city X.
D) cares about the well-being of the individuals in city X.
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A) average fixed cost declines continually as output rises.
B) a firm has no fixed costs.
C) a firm has no variable costs.
D) a firm has both variable and fixed costs.
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A) 0BCQ1
B) 0ADQ1
C) DCE
D) ABCD
E) GFC
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A) equal to marginal revenue.
B) greater than marginal cost.
C) less than marginal revenue, but greater than marginal cost.
D) greater than marginal revenue, but equal to marginal cost.
E) a and b
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A) rent seeking behavior.
B) the lack of competitive pressure.
C) third-degree price discrimination.
D) first-degree price discrimination.
E) none of the above
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A) A perfectly price-discriminating monopolist does not lower price on all previous units in order to sell an additional unit of its product.
B) Second-degree price discrimination is when the seller charges a uniform price per unit for one specific quantity, a lower price of an additional quantity, and so on.
C) Charging senior citizens less for medicine is an act of third-degree price discrimination.
D) Charging women less for a car wash is an act of second-degree price discrimination.
E) A price taker cannot practice price discrimination.
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A) downward sloping and lies below the firm's demand curve.
B) upward sloping and lies above the firm's demand curve.
C) perfectly inelastic.
D) downward sloping and lies above the firm's demand curve.
E) the same as the industry demand curve.
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A) trying to pay the lowest rent possible for an apartment or house.
B) trying to lower rent that is paid on a factory in order to lower fixed costs.
C) the actions of individuals who spend resources to influence public policy in the hope of transferring income to themselves from others.
D) the fact that the deadweight loss triangle is a genuine cost of monopoly.
E) none of the above
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A) units.
B) quantities.
C) buyers.
D) prices.
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A) The monopolist has the ability to control to some degree the price of the product it sells.
B) The monopolist faces a downward-sloping demand curve.
C) The monopolist is a price taker.
D) The monopoly firm is the industry.
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A) The seller must be a price searcher.
B) The seller must be able to distinguish between customers willing to pay different prices.
C) It must cost the seller more to service some customers than others.
D) Reselling the product must be extremely costly or must not be possible
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Sellers want to maximize profits, and pr...View Answer
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