microecon ch 12 – Flashcards

When the value of a product to each user, including existing users, increases due to an increase in the total number of users, we refer to this as:

Allocative inefficiency happens in a monopoly because at the profit-maximizing output level

A non-discriminating pure monopolist is generally viewed as:

Many people believe that monopolies charge any price they want to without affecting sales. Instead, the output level for a profit-maximizing monopoly is determined by:

The non-discriminating pure monopolist must decrease price on all units of a product sold in order to sell more units. This explains why:

With a natural monopoly, the fair return price:

An exclusive legal right as sole producer for 20 years granted to an inventor of a product is called a

A monopoly results in productive inefficiency because at the profit-maximizing output level:

Barriers to entry

With non-rivalrous consumption such as in the case of online music and movies, as more consumers buy the product:

A non-discriminating monopolist will find that marginal revenue

Refer to the above graph showing the revenue curves for a monopolist. Total revenue will be greatest at what output level?

An argument for making regulated monopolies adopt marginal cost pricing is that this would:

Refer to the above graph showing the revenue curves for a monopolist. If it wants to sell quantity Q1, it must charge a price

Under pure monopoly, a profit-maximizing firm will produce

Refer to the above graph showing the revenue curves for a monopolist. At what output level is demand inelastic?

Which is true of a price discriminating pure monopolist?

The economic incentive for price discrimination is based upon

One feature of pure monopoly is that the firm is:

A firm will earn economic profits whenever:

In the short run equilibrium, a monopolist's profits:

Refer to the above graph showing the revenue curves for a monopolist. The elastic portion of the demand curve ranges from quantity:

Which of the above shows the correct relationship between demand and marginal revenue?

X-inefficiency is said to occur when a monopolist's

Which phrase would be most characteristic of pure monopoly