Monopoly and Antitrust MCQ
Monopoly and Antitrust MCQ
1. If a monopoly’s fixed costs increase, its price will _____, and its profit will _____.
Answer
Correct Answer:
Stay the same, decrease
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2. Price discrimination requires ______.
Answer
Correct Answer:
Knowing who has willingness to pay
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3. What is price discrimination?
Answer
Correct Answer:
Charging different customers different prices for the same good
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4. Average cost pricing ______.
Answer
Correct Answer:
Leads to a deadweight loss
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5. In 1911, ______ was broken up by antitrust laws.
Answer
Correct Answer:
The Standard Oil Trust
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6. Significant laws restricting monopolies in the United States began to be passed in the ______.
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7. Most firms ______.
Answer
Correct Answer:
Create products that have good substitutes
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8. From the view of society, monopolies produce ______.
Answer
Correct Answer:
Too little of a good
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9. People who buy up patents just so they can sue for infringement are known as patent ______.
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10. Patents give exclusive rights to a product for up to ______.
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11. When MR = MC, a monopolist will ______ profits.
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12. What will happen if a monopolist raises prices?
Answer
Correct Answer:
It will lose some of its customers.
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13. A horizontal demand curve happens with ______.
Answer
Correct Answer:
Pure competition
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14. A natural monopoly occurs when ______.
Answer
Correct Answer:
One company is more efficient than any two or more other companies
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15. When a government determines who can participate in a certain type of business, it creates a(n) ______.
Answer
Correct Answer:
Legal barrier
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16. A ______ occurs when there is a single supplier of a product that has no close substitutes.
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17. The practice of charging different consumers different prices for the same good or service is called _____.
Answer
Correct Answer:
Price discrimination
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18. A firm that can produce at a lower cost than several smaller firms can is called _____.
Answer
Correct Answer:
Natural monopoly
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19. The single supplier of a product that has no close substitute is called _____.
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20. Average cost pricing is setting price _____ to the average total cost.
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