Understanding Monopoly Economics

Understanding Monopoly Economics

Assessment

Interactive Video

Business, Economics

10th Grade - University

Hard

Created by

Lucas Foster

Used 1+ times

FREE Resource

This video explores the economic profit of a monopoly firm, focusing on demand and marginal revenue curves. It explains how monopolies determine rational production quantities and set prices, leading to deadweight loss. The video also discusses economic profit and barriers to entry, highlighting differences from perfect competition.

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10 questions

Show all answers

1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What happens to the demand for a monopoly firm's product as the price decreases?

Demand decreases

Demand remains constant

Demand increases

Demand becomes unpredictable

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How does the marginal revenue curve of a monopoly compare to its demand curve?

It is the same as the demand curve

It is a horizontal line

It slopes downward faster than the demand curve

It slopes upward

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the rational quantity for a monopoly firm to produce?

Where marginal cost equals marginal revenue

Where marginal cost is less than marginal revenue

Where average cost equals average revenue

Where marginal cost is greater than marginal revenue

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

In a monopoly, how is the market price determined?

By the average total cost curve

By the demand curve at the rational quantity

By the intersection of marginal revenue and demand curves

By the intersection of marginal cost and demand curves

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is deadweight loss in the context of a monopoly?

The loss of profit due to high competition

The loss of potential market benefits due to reduced quantity

The loss of demand due to high prices

The loss of revenue due to high production costs

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

In a monopoly, what is the significance of the difference between price and marginal cost?

It represents a loss

It represents a markup

It represents a discount

It represents a subsidy

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How is economic profit calculated for a monopoly firm?

By adding average total cost to price and multiplying by quantity

By adding marginal cost to price and multiplying by quantity

By subtracting marginal cost from price and multiplying by quantity

By subtracting average total cost from price and multiplying by quantity

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