Question 12(Multiple Choice Worth 2 points) (04.05 MC)

Compared to an oligopoly market without cooperation, one in which the individual firms form a cartel will produce and charge .

less; less
less; more
more; less
more; more
indeterminate
Question 13(Multiple Choice Worth 2 points)
(04.02 MC)

The allocatively efficient quantity of widgets for the whole market is 10 million units. At that quantity, the demand for widgets is at $10. However, the single supplier of widgets is producing 5 million units and charging $20 per widget. Based on this data, the market for widgets is

a monopoly
an oligopoly
productively efficient
operating at minimum efficient scale
experiencing economic losses
Question 14(Multiple Choice Worth 2 points)
(04.03 MC)

The graph below represents the demand graph of a monopolist.

Graph of monopoly. A curve labeled MC slopes downward and then upward to the right, intersecting a downward sloping line labeled MR at P equals 8 dollars and Q equals 40 and another downward sloping line labeled Demand at P equals 12 dollars and Q equals 50. At Q equals 40, the Demand line is at P equals 14 dollars. Both Demand and MR start at P equals 22 dollars on the vertical axis.

The firm uses price discrimination to increase its profits. What is the change in the price level? Assume the firm is acting to maximize profits before and after price discrimination.

From $8 to $14
From $14 to $8
From $14 to $12
From $8 to demand level at every output quantity
From $14 to demand level at every output quantity
Question 15(Multiple Choice Worth 2 points)
(04.02 MC)

Use the graph to answer the question that follows.

Downward sloping AR curve above downward sloping MR curve. Typically shaped MC and AC curves. MC intersects MR at point G and at Quantity Q2. Point N is on the MC curve and is associated with the points P2 and Q2. Point M is on the AR curve and is associated with the points P1 and Q2. MC intersects MC at point H associated with quantity Q1.

What would be the area of this firm's total revenue?

P3, G, Q2, and 0
P2, N, Q2, 0
P1, M, Q2, 0
P1, M, N, P2
P1, M, G, P3