Node)

l.

Given the same cost and revenue schedules, a profitmaximising monopolist rvill produce:
6) t.ss output rhan a competirive industry..
b. more output than a competitive industry.
c. the same amount of output as a competitive industry
d. none of the above.

2.

The quantity supplied by a profit-maximizing monopolist is;

a. equal to the quantity demanded at the competitive
market price.
b. insufficient to supply the quantity demanded at the
monopoly pr.ice.
c. equal to the quantity demanded when price equals
marginal cost.
insufficient to satisfy the quantity dentanded at the
competitive market price.

Ailtt&rQgA

6.

The profit-ntaximtzllng output of a monopolist is established by

the intersect.ion of the:
a. Demand and MC cr.rrves
,[-., Supply and MR curves
(UMR and IVIC curves
I
d. Demand and ATC curves

1.

If at a rnonthly output rare of 500 units, ATC is $40 and price

is $60, then total profit per month is:
a.
b.

@
Y.
8.

Price

9.
Pl

If at a monthly output rate of 100 units, AVC is $2.50,

price is $4 and AFC is $1, then total profit per month is:

P2

A monopoly realizes larger profits than a cornparable

competitive industry by:
a. serting a higher price at the competitive level of

'3

b.

P(

Demand

3.

o1

o2

For the monopolist depicted in the figure above, the

profit-maximizing price and output, respectjvely, are:
A OP. and OQ,
(D oP, and OQr
a. OP2 and OQ,
d. OPr and OQ,

At

the rate of outpul OQ,

the line segment:

profit per unit is represented

10.

by

u. AeL
b. DE
c. AE
/aT)en
5

If the revenue and the cost data in the tigure above u,ere.
representative of a perfectly competitive industry. the
equi)ibrium price
a. OP, and
or, und
-c. OP, and
d. OP4 and

(D

and quantity, respectii,ely, would be:

OO.

odj
OQ,

OQ,

output, therebf increasing total levenue.

producing a greater quantity at the cbmpetitive price,
thereby increasing profits.
producing at output levels with more favorable cost
structures and charging the competitve market price,
thereby increasing profits per unit.
reducing market supply and pushing prices up.

---------------->
0

sro,ooo
s.lo.ooo

a. $25
fG\ sso
c. Sl00
d. $500

USE THE FOLLOWING FIGURE TO ANSWER THE

QUESTIONS 3 THROUGH

$1000
$2000

Which of the following is NOT necessarily true of a profit_

maximizing monopoly firm in equilibrium?
a. tolal profit is maxirnum for the firm.
b. there is less outpur than under competitive
conditions.
costs are minimum at the equilibrium rate of
1c.')avera-ee
\-^ output.
d. the price is higher than under competiti\ie conditions.