Which of the following is not a barrier to entry in a monopolized market ?

A. A single firm is very large
B. The government gives a single firm the exclusive right to produce some good
C. The costs of production make a single producer more efficient than a large number of productions
D. A key resource is owned by a single firm

When a monopolist produces an additional unit, the marginal revenue generated by that unit must be ?

A. Below the price because the price effect outweighs the output effect
B. Above the price because the output effect outweighs the price effect
C. Above the price because the price effect outweighs the output effect
D. Below the price because the output effect outweighs the price effect

Which of the following statements about price and marginal cost in competitive and monopolized markets is true ?

A. In competitive markets, price equals marginal cost, in monopolized markets price exceeds marginal cost.
B. In competitive markets price equals marginal cost, in monopolized markets price equals marginal cost
C. In competitive markets price exceeds marginal cost, in monopolized markets price exceeds marginal cost
D. In competitive markets price exceeds marginal cost in monopolized markets price equals marginal cost

Thomas is a monopolist in the production of your textbook because ?

A. Thomson has a legally protected exclusive right to produce this textbook
B. Thomson owns a key resource in the production of textbooks.
C. Thomson is a natural monopoly,
D. Thomson is a very large company

Which of the following firms has the least incentive to advertise ?

A. A manual fracture of breakfast cereal
B. A wholesaler of crude oil
C. A restaurant
D. A manufacturer of home heating and air conditioning

One source of inefficiency in monopolistic competition is that since price is above marginal cost, some units are not produced that buyers value in ?

A. Since price is above marginal cost surplus is redistributed from buyers to sellers
B. Monopolistically competitive firms earn economic profits in the long run
C. Monopolistically competitive firms produce beyond their efficient scale
D. Excess of the cost of production and this causes a deadweight loss.

The use of word “competition” in the name of the market structure called “monopolistic competition” refers to the fact that ?

A. There are many sellers in a monopolistically competitive market and there is free entry and exit in the market just like a competitive market
B. Monopolistically competitive firms face a downward-sloping demand curve just like competitive firms.
C. Monopolistically competitive firms charge prices equal to the minimum of their average total cost just like competitive firms.
D. The products are differentiated in a monopolistically competitive market just like in a competitive market.

Which of the following firms is most likely to spend a large percentage of their revenue on advertising ?

A. The producer of a highly differentiated consumer product
B. The manufacturer of an undifferentiated consumer commodity
C. A perfect competitor
D. The manufacturer of an industrial product

Which of the following is not put forth as a criticism of advertising and brand names ?

A. Advertising manipulates people’s tastes to create a desire that otherwise would not exist
B. Advertising increase competition which causes unnecessary bankruptcies and layoffs.
C. Advertising increases brand loyalty causes demand to be more inelastic and thus, increase mark-up over marginal cost.
All of these answers are criticisms of advertising and brand names

X inefficiency occurs when ?

A. The price is greater than the marginal cost
B. The price is greater than the average cost
C. Costs are higher than they could be due to a lack of competitive pressure
D. There are external cost