Deck 15: Monopoly, Price Discrimination, and Oligopoly: Exploring Market Structures and Strategies

Question 1

Monopolist can fix

A)Both price and output
B)Neither price and output
C)Either price and output
D)None of the above

Answer 1

Either price and output

Question 2

A discrimination monopolist charges in a market

A)Lower prices if it has lower elasticity
B)Higher prices if it has lower elasticity
C)Lower prices if it has higher elasticity
D)Cannot say

Answer 2

Lower prices if it has lower elasticity

Question 3

A firm practicing price discrimination will be

A)Changing qualities of the product
B)Buying from the cheapest market
C)Buying from firms
D)Charging different prices in different markets

Answer 3

Charging different prices in different markets

Question 4

The best level of output for the monopolist is

A)AC is minimum
B)TC=TR
C)TR and TC are parallel
D)TR is maximum

Question 5

If the monopolist faces identical demand for his commodity in the two separate markets, by practicing third degree price discrimination

A)Will increase his TR and total profit
B)Can increase his TR and profit
C)Cannot increase his TR and profit
D)Will charge different prices in different market

Question 6

Under pure monopoly, there will be

A)No distinction between firm and industry
B)One firm no industry
C)No firm one industry
D)Very few firms

Question 7

Monopolist will not produce that portion of demand curve where the elasticity of demand

A)Equal to unity
B)Less than unity
C)Greater than zero
D)None of the above

Question 8

Under monopoly, the equilibrium price is

A)Equal to MC
B)Less than MC
C)More than MC
D)Equal to AC

Question 9

The cross elasticity of demand for the monopolist product is

A)Very low
B)Moderate
C)High
D)Very high

Question 10

Which of the following is known as the perfect price discrimination

A)First degree price discrimination
B)Second degree price discrimination
C)Third degree price discrimination
D)Nine of the above

Question 11

A monopolist usually earns

A)Economic profit
B)Only normal profit
C)Losses
D)Profit and losses, which are uncertain

Question 12

Price discrimination is possible

A)Under any market form
B)Only under monopoly
C)Only under monopolistic competition
D)Only in perfect competition

Question 13

Who introduced various types of price discrimination

A)Alfred Marshall
B)Adam Smith
C)A C Pigou
D)J B Say

Question 14

Oligopoly is a market situation characterized by

A)Large number of buyers and sellers
B)A single seller
C)Fairly large number of buyers and sellers
D)A few sellers

Question 15

Price leadership can be in the form of

A)Price leadership by a low cost firm
B)Price leadership by a dominant firm
C)A barometric price leadership
D)All of the above

Question 16

Assertion (A) Many oligopolistic industries exhibit an appreciable degree of Price rigidity or stability Reason (R) Oligopolists face a demand curve that is highly elastic for price increases and less elastic for price reductions

A)(A) is true but (R) is false.
B)Both (A) and (R) are false
C)Both (A) and (R) are true and (R) is the correct explanation of (A)
D)Both (A) and (R) are true but (R) is not the correct explanation of (A)

Question 17

The equilibrium level of output for a perfectly competitive market is

A)MC = AC
B)MC = MR
C)TC = TR
D)None of the above

Question 18

The term 'monopsony' refers to

A)a single seller
B)a single buyer
C)a single buyer and a single seller
D)None of the above

Question 19

In Chamberlin and Kinked demand curve model, the oligoposist

A)Recognize their interdependence
B)Do not collude
C)Tend to keep prices constant
D)All of the above

Question 20

If an oligopolist incurs losses in the short run, then in the long run

A)The oligopolist will go out of business
B)The oligopolist will stay in business
C)The oligopolist will break-even
D)Any of the above

Question 21

Existence of large number of buyers and sellers and homogenous product is a feature of :

A)Monopoly
B)Duopoly
C)Perfect Competition
D)Oligopoly

Question 22

Product differentiation is a characteristic of:

A)Monopoly
B)Perfect Competition
C)Monopolistic Competition
D)Oligopoly

Question 23

A firm under Perfect Competition is a:

A)Price maker
B)Price taker
C)Monopolist
D)None of these

Question 24

Selling cost is a feature of :

A)Perfect Competition
B)Monopoly
C)Monopolistic Competition
D)Oligopoly

Question 25

Oligopoly is characterized by:

A)A few Sellers
B)One seller
C)Large Sellers
D)All of these