A. marginal cost is set equal to marginal revenue
B. price is less than marginal cost
C. marginal consumer benefit is less than marginal revenue
D. there is too little output at too high a cost
Related Mcqs:
- Pricing to cover variable costs and some fixed costs as in the case of some automobile distributorships that sell below total costs is typical of which of the following pricing objectives ?
A. current profit maximization
B. product quality leadership
C. Market share leadership
D. Survival - Comparing a monopoly and competitive firm, the monopolist will ?
A. produce less at a lower price
B. produce more at a lower price
C. produce less at a higher price
D. produce less at a lower price - A monopoly may be self-perpetuating because profits may be used for ?
A. research
B. cost-saving
C. technical advance
D. all of the above - A natural monopoly has a declining _______ over a large range of output?
A. long run marginal cost
B. short run marginal cost
C. long run average cost
D. long run marginal cost - The problem posed by a natural monopoly is that it faces a _____ This means that _______?
A. increasing average cost curve, marginal cost lies above average cost
B. increasing average cost curve, marginal cost lies below average cost
C. decreasing average cost curve marginal cost lies above average cost
D. decreasing average cost curve, marginal cost lies below average cost - Which of the following is true regarding the similarities and differences in monopolistic competition and monopoly ?
A. the monopolist faces a downward-sloping demand curve while the monopolistic competitor faces an elastic demand curve
B. the monopolist charges a price above marginal cost while the monopolistic competitor charges a price equal to marginal cost
C. The monopolist makes economic profits in the long run while the monopolistic competitor makes zero economic profits in the long run
D. Both the monopolist and the monopolistic competitor operate at the efficient scale - A welfare loss occurs in monopoly where ?
A. The price is greater than the marginal cost
B. The price is greater than the marginal benefit
C. The price is greater than the average revenue
D. The price is greater than the marginal revenue - Which of the following is necessary for a natural monopoly ?
A. economies of scale
B. a high proportion of the total cost in the cost of capital goods
C. the market is very small
D. all of the above - If regulators break up a natural monopoly into many smaller firms, the cost of production ?
A. will rise
B. will fall
C. will remain the same
D. could either rise or fall depending on the elasticity of the monopolist’s supply curve - Groundnut crop is the monopoly of ?
A. Indonesia
B. Bangladesh
C. Pakistan
D. India
