1. If, for a perfectly competitive firm, price exceeds the marginal cost of production, the firm should

Select one:

a.

increase its output.

b.

lower the price.

c.

reduce its output.

d.

stop producing.

e.

keep output constant and enjoy the above normal profit.

2. A discriminating monopolist must ensure that, for price discrimination to be effective, one of the following factors must be in place.

Select one:

a.

discount prices

b.

different market segments with different price elasticities

c.

very high price

d.

highly knowledgeable consumers

e.

resale of products at high prices in high end markets

3. Assuming the current manufacturers of COVID-19 vaccines are pushing for patent protection to be extended to 15 years before generics are allowed to be introduced to the market. This reflects which of the following barriers to entry?

Select one:

a.

entry blocked by government action

b.

network externalities

c.

economies of scale creating a natural monopoly

d.

control of a key resource

e.

product variety externalities