An oligopoly with a dominant price leader will produce a level of output ?

A. Equal to what a monopolist would choose in the same industry
B. Between that which would prevail under competition and that which a monopolist would choose in the same industry
C. That would prevail under competition
D. Between that which would prevail under competition and that which a monopolistic competitor would choose in the same industry.

A major weakness of the kinked demand curve model of oligopoly is that ?

A. It assumes that firms believe that their rivals will not respond to any price change they initiate
B. It fails to explain how a firm arrived at its price and output decision initially
C. The model cannot be tested empirically.
D. Real-world pricing strategies are more simple than those assumed in this model

Which of the following statements is False ?

A. Participants in a contestable market are continuously faced with competition or the threat of competition because entry is cheap
B. In a contestable market, economic profits cannot persist in the long run.
C. In a contestable market forces will guarantee that the firms produce efficiently or be driven out of business
D. For a market to be contestable, the product must be produced with a labor-intensive technology

Which statement is False ?

A. Fixed costs are zero if the firms is producing nothing.
B. Fixed costs are the difference between total costs and total variable costs
C. There are no fixed costs in the long run
D. Fixed costs do not depend on the firm’s level of output

The costs that depend on output in the short run are ?

A. Total fixed cost only.
B. Total variable costs only.
C. Both total variable costs and total costs.
D. Total costs only

The long-run equilibrium outcomes in monopolistic competition and perfect competition are similar because in both market structures ?

A. The efficient output level will be produced in the long run
B. Firms will only earn a normal profit
C. Firms realize all economies of scale
D. Firms will be producing at minimum average cost

When one firm in the breakfast cereal market started an advertising campaign that stressed the nutritional value of its cereals, all other cereal manufacturers started similar advertising campaign This suggests that the breakfast cereal market is ?

A. Monopolistically competitive
B. Oligopolistic
C. Perfectly competitive
D. Indeterminate from this information

Assume that firms in an oligopoly are currently colluding to set price and output to maximise total industry profit. If the oligopolists are forced to stop colluding, the price charged by the oligopolists will _________ and the total output produced will __________?

A. Decrease; decrease
B. Increase; decrease
C. Decrease; increase
D. Increase; increase

In a monopoly, marginal revenue is ?

A. Lower than price for all units other than the first
B. Less than price at low levels of output and greater than price at high levels of output
C. Always greater than price
D. Always equal to price

An industry that realizes such large economies of scale in producing its product that single-firm production of that good or service is most efficient is called ?

A. A fixed cost monopoly
B. A natural monopoly
C. A government franchise monopoly
D. A economies of scale monopoly