Reference no: EM131503590
1. A monopolist faces a demand curve given by P=10-Q and has constant marginal (and average cost) of 2. ? What is the economic profit made by this profit-maximising monopolist if they engage in perfect price discrimination?
a. 32
b. 64
c. 100
d. 121
e. None of the above
2. Consider a monopolist who faces the following demand function: P=10-Q. Which of the following statements is true about the monopolist's marginal revenue (MR) and average revenue (AR)?
a. MR and AR have the same vertical intercept.
b. MR has a horizontal intercept that is half that of the horizontal intercept of AR.c. MR has a steeper slope than AR.
d. a, b, and c are correct.
e. none of the above.
3. A monopolist faces a demand curve given by P=10-Q and has constant marginal (and average cost) of 2. ? What is the economic profit made by this profit-maximising monopolist?
a. 0
b. 12
c. 14
d. 16
e. None of the above
4. A monopolist faces a demand curve given by P=10-Q and has constant marginal (and average cost) of 2. What is the output and the price that maximizes profit for this monopolist?
a. Q=0,P=10.
b. Q=2,P=8.
c. Q=4,P=6.
d. Q=8,P=2.
e. None of the above
5. Consider a monopolist who faces the following demand function: P=10-Q. Which of the following statements is true about the elasticity of demand (ε) [Hint: Note that ε= (dQ/Q)(P/dP)] ?
a. ε= 1+10/Q.
b. ε= 1-10/Q.
c. ε= Q(1+10/Q).
d. ε= Q(1-10/Q).
e. none of the above.
6. Consider a monopolist who faces the following demand function: P=10-Q. Which of the following statements is true about the elasticity of demand (ε) and MR?
a. MR>0 when ε<-1.
b. MR>0 when ε=-1.
c. MR>0 when ε>-1.
d. MR is always <0.
e. none of the above.
7. A monopolist faces a demand curve given by P=10-Q and has constant marginal (and average cost) of 2.? What is the value of the deadweight loss generated by this monopolist?
a. 2
b. 4
c. 6
d. 8
e. None of the above
8. Consider a monopolist who faces the following demand function: P=10-Q. Which of the following statements is true about the monopolist's marginal revenue (MR)?
a. MR>0 when Q<5.
b. MR=0 when Q=5.
c. MR<0 when Q>5.
d. a, b, and c are correct.
e. none of the above.