Governments regulate natural monopoly by capping the price at ________.

A. marginal revenue and allowing the monopoly to maximize profit

B. marginal cost so that the monopoly is efficient and makes zero economic profit

C. average total cost, which allows the monopoly to be inefficient but make zero economic profit

D. the buyers’ willingness to pay, which makes the monopoly operate efficiently

A single-price monopoly is ________.

A. inefficient because it converts consumer surplus to producer surplus

B. inefficient because it produces too small an output and creates a deadweight loss

C. efficient because buyers are paying a price equal to their willingness to pay

D. efficient because it is the only producer of the good

The Sherman act makes it illegal to?

What is the price each type of customer is charged and how many haircuts an hour does Bobbie’s sell? What is the increase in Bobbie’s economic profit that results from price discrimination?

A single-price monopoly maximizes profit by producing the quantity at which ________.

A. its total revenue will be as large as possible

B. marginal revenue equals marginal cost and setting the price equal to marginal revenue

C. marginal revenue equals marginal cost and setting the price equal to marginal cost

D. marginal revenue equals marginal cost and setting the price equal to the most people are willing to pay for that quantity

A single-price monopoly is ________. A. inefficient because it converts consumer surplus to producer surplus B. inefficient because it produces too small an output and creates a deadweight loss C. efficient because buyers are paying a price equal to their willingness to pay D. efficient because it is the only producer of the good

A firm is a natural monopoly if ________.

A. it can produce the good at a price below its competitor’s price

B. it can produce a larger quantity of the good than other firms

C. the government grants it a public franchise or patent

D. it can satisfy the market demand at a lower average total cost than other firms

A firm is a natural monopoly if ________. A. it can produce the good at a price below its competitor’s price B. it can produce a larger quantity of the good than other firms could C. the government grants it a public franchise or patent D. it can satisfy the market demand at a lower average total cost than other firms can

A monopoly ________.

A. can choose its price and output and always has the option of price discriminating

B. is a price taker and by offering a range of discounts can price discriminate

C. that produces a good that cannot be resold might choose to price discriminate

D. book store that offers a discount on Tuesdays is price discriminating

Why is there a social cost to monopoly power? If the gains to producers from monopoly power could be redistributed to consumers, would the social cost of monopoly power be eliminated? Explain briefly.

Perfect competition is efficient because all the following conditions hold except ________.

A. total product is maximized

B. firms maximize profit and produce on their supply curves

C. consumers get a real bargain and pay a price below the value of the good

D. firms minimize their average total cost of producing the good

Perfect competition is efficient because all the following conditions hold except ________. A. total product is maximized B. firms maximize profit and produce on their supply curves C. consumers get a real bargain and pay a price below the value of the good D. firms minimize their average total cost of producing the good

A monopoly ________. A. can choose its price and output and always has the option of price discriminating B. is a price taker and by offering a range of discounts can price discriminate C. that produces a good that cannot be resold might choose to price discriminate D. book store that offers a discount on Tuesdays is price discriminating

What is a monopoly? Can a firm be a monopoly if close substitutes for its product exist?