Question

NAME PRINT LAST NAME, FIRST NAME SECTIONE MONOPOLY is a pure monopoly when: İt is the only seller of a unique product and barriers to entry pneventother selen from entering the market in the long run it is the only seller of a product that has the market in the long run is unrestricted b. very few close substitutes and entry into C. there are only a few other very large firms selling similar products. d. it can sell all it can produce at any price it chooses 2. Barriers to entry: a. guarantee that a firm will always eam positive economic profit b. cannot be maintained in the long run because other firms will always find a way to enter a profitable industry are obstacles that make it impossible or market in the long run. characterize both perfectly competitive and monopoly markets c. unprofitable for new firms to enter a d. Suppose MR- MC $3 at an output level of 2,000 units. If a monopolist produces sells 2,000 units, charging a price of $6 per unit and incurring average unit, the monopolist will earn profit equal to: a. $6,000 b. $4,000 3. and total cost of $5 per $2,000 $1,000. Price discrimination allows a monopolist to: a. 4. charge each customer the same high price, even though some customers are willing to pay more than others charge those customers with a greater willingness to pay a higher price, resulting in higher profit. charge a price for its product that exceeds the cost of producing it. avoid having to make a pricing decision and leave it to government regulators b. c. d. For a firm with monopoly power that cannot engage in price discrimination: a. the marginal revenue curve lies below the demand curve because any reduction in price applies only to the last unit sold. the marginal revenue curve lies below the demand curve because the firm must lower price on all units in order to sell a higher level of output. the marginal revenue curve lies above the demand curve because the monopoly firm can charge any price it wishes. total revenue is a linear function of output because sales are independent of product price. 5. b. c. d. Chanter 12 Assignments

Answer 1

Ans 1: (A) because a pure monopoly is a single firm, sells unique product and entry of new firms is strictly restricted due to patent rights, law, etc

Ans 2: (C) In monopoly, other firms cannot enter because it is unprofitable.

Ans 3: In image attached below:

Ans 4: (B) It charges different prices for customers based on their willingness to pay, for the same product.

Ans 5: (B) because in order to sell more, it has to reduce price for all units sold.