Question 1

What is the best outcome for society: When firms in an oligopoly operate as a monopoly or when they act as perfect competitors?
 Briefly explain your answer.

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Question 2

What is the legal status of a cartel among firms in the United States?

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Question 3

-The figure above shows the market demand curve for a market with three firms. It also shows a firm's marginal cost curve. In this oligopoly, what is the range of output and prices?
 Why does this range of outcomes exist?

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-The figure above shows the market demand...

Question 4

"Because firms in an oligopoly are so large, they do not need to consider each other's actions." Is the previous statement correct or incorrect?
 Explain your answer.

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Question 5

Describe the characteristics of an oligopoly.

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Question 6

Why are cartels among firms usually kept secret?

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Question 7

What is a cartel?

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Question 8

Draw an example of a firm in monopolistic competition that is earning an economic profit. Be sure to label all the curves. Indicate the area that equals the firm's economic profit.

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Question 9

Explain what a cartel is and the difficulties faced in maintaining a cartel.

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Question 10

What market structures other than oligopoly have the characteristic of one firm's actions affecting the actions of its competitors?
 Explain your answer.

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Question 11

"If firms in an oligopoly operate as a monopoly, the industry produces the most output and if they operate as perfect competitors, the industry produces the least output." Is the previous statement correct or incorrect?
 Why?

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Question 12

Why would a firm in a monopolistically competitive industry advertise?

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Question 13

Explain the role of advertising in monopolistic competition. Describe how advertising by all firms in a monopolistically competitive industry impacts a firm's ATC curve, its MC curve, its demand curve, and its MR curve.

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Question 14

-The above figure represents Tony's Pizza Parlor, a firm in monopolistic competition.
a. What quantity will be produced?
b. What price will be charged?
c. What is Tony's total cost?
d. What is Tony's total revenue?
e. What is Tony's economic profit or loss?
f. Is this a long-run equilibrium?
 Why or why not?

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-The above figure represents Tony's Pizza Parlor,...

Question 15

How do product development and marketing affect a firm in monopolistic competition?

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Question 16

In the Boeing/Airbus oligopoly example discussed in the text, why did Boeing and Airbus have an incentive to produce more planes than the monopoly outcome?

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Question 17

-The above figure represents a restaurant operating in monopolistic competition.
a. What is the profit-maximizing level of output?
b. What price will the firm charge?
c. What is the firm's profit (or loss)?
d. Is this a long-run equilibrium?
 Why or why not?
e. Is this firm producing its efficient scale of output?

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-The above figure represents a restaurant operating...

Question 18

Explain how selling costs in monopolistic competition affect the efficiency of monopolistic competition.

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Question 19

-The above figure shows the market for the three moving companies in a small nation. If the movers act as perfect competitors, what is the price per mile and the number of miles per year?
 If the movers collude and act as a single monopoly, what is the price per mile and the number of lines per year?

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-The above figure shows the market for...

Question 20

Why are selling costs high in monopolistic competition?

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Quiz 13: Monopolistic Competition and Oligopoly

What is the best outcome for society: When firms in an oligopoly operate as a monopoly or when they act as perfect competitors? Briefly explain your answer.