AP Micro - Monopolies

When one or more unit is sold, the total revenue increases by the price at which the unit is sold. This is known as

• quantity effect
• price effect
• substitution effect
• income effect

In order to sell the last unit, a monopolist must cut the market price on all units sold. This will decrease TR. This idea is known as the

• quantity effect
• Price effect
• Substitution effect
• Income Effect

For a monopolist, Total Revenue is highest when 

• Marginal Revenue is equal to zero
• Marginal Revenue is the highest
• marginal revenue is negative
• marginal revenue is increasing

To maximize profits, the monopolist will produce where

• MR=MC
• MR>MC
• MR = 0

The monopolist's profit-maximizing output is

• 0
• 4
• 8
• 10

The monopolist's total revenue equals

• $80
• $160
• $240
• $300

The monopolist's total cost equals

• $20
• $80
• $160
• $0

The monopolist is earning a profit equal to

• $0
• $40
• $80
• $160

Within the range of market demand, which of the following is consistent with the conditions of a natural monopoly?

• Long-run total cost decreases as output increases.

• Long-run average total cost remains constant as output increases.

• Long-run average total cost decreases as output increases.

• Marginal cost exceeds Average cost.

Which of the following is a source of monopoly power?

• Scarcity
• Elasticity of demand
• Barriers to entry
• Low Profits