no special format. just multiples questions
32. The pizza delivery industry may be considered monopolistically competitive. One of these firms raises its prices by 10%, but all the other pizzerias in the area maintain their current prices. Which of the following is most likely to occur? A. The pizza place with the new prices will not be able to sell any pizza, because it was the only firm to increase prices. B. The pizza place with the new prices will lose some of its customers to rivals. C. The pizza place with the new prices will increase their profits. D. The number of customers served by the pizza place with new prices will increase. 3 ' MC ATE: 0 Quantity 33. The monopolistically competitive firm shown in the figure above: A. is in long run equilibrium. B. might realize an economic profit or a loss, depending on its choice of output level. C. cannot operate profitably, at least in the short run. D. can realize an economic profit. 34. TRUE or FALSE Oligopoly firms have very little market power because it is shared among rivals. 35. Which of the following is NOT an example of price discrimination? A. Airlines charging lower prices to travelers who stay overnight at least one night B. Student discounts at movie theatres C. Back-to-school sales D. Discounted coffee for seniors at Dunkin' 36. The automobile, household appliance, and auto tire industries are illustrations of: A. oligopoly that produces a standardized or homogenous product B. monopolistic competition that produces a variety of products. C. monopoly where there are no close substitutes. D. oligopoly that produces a differentiated or heterogeneous product. 37. Which of the following are benets associated with the oligopoly model? A. allocative efficiency B. productive efficiency C. product variety and innovation D. few barriers to entry 38. TRUE or FALSE Monopolistically competitive rms may realize either prots or losses in the short run but realize normal profits in the long run. Use the following graph to answer the next 3 questions. $_ , .40. .35 531 a3\". D 25.. ..,_ .1.\" . 0' 12 14 16 - 0 Packs of chewing gum in thousands 39. Six firms that produce chewing gum might be described as an oligopoly. The industry faces the market demand curve given by D. To maximize profits, the industry should produce packs of chewing gum and the price should be . A. 12,000; $0.25 B. 12,000; $0.40 C. 14,000; $0.30 D. 16,000; $0.35 40. Same six firms as above. The firms have identical cost structures. If the industry produces the profit maximizing output level, EACH FIRM could produce: A. 2,000 packs of chewing gum. B. 12,000 packs of chewing gum C. 6,000 packs of chewing gum. D. indeterminate output levels from this information 41. Same six firms as above. Maximum profit level is: A. 50.00 B. $1,080 C. 51,800 D. Indeterminate from this information. 42. TRUE or FALSE Game Theory is best suited to analyze the behaviour of monopolistically competitive firms because while there may be a number of firms, they each pay close attention to their rivals or competitors. 43. Oligopoly is difficult to analyze primarily because: A. the number of firms is too large to make collusion possible. B. the price and output decisions of one firm depend on the reaction of its rivals. C. output may be either homogeneous or heterogeneous. D. neither allocative nor productive efficiency is achieved. 24. What do economies of scale, the ownership of essential raw materials and patents have in common? A. They must all be present before price discrimination can be practiced. B. They are all barriers of entry. C. They help explain why a monopolist's demand curve and MR curve are the same. D. They help explain why the long-run ATC is U-shaped. Use the following diagram to answer the next 3 questions. 0 too 1.0 fl! 2'0 m 25. The profit maximizing (or loss minimizing) level of output for this firm is 26. The profit maximizing price (or loss minimizing price) for this firm is 27. The profit (or loss) for this firm is . SHOW YOUR WORK. 28. TRUE or FALSE A firm with market power is able to sell all of their output at any price they desire. 29. A monopolistically competitive rm has a A. highly or relatively elastic demand curve due to the presence of substitutes. B. highly or relatively elastic demand curve due to a few substitutes. C. highly or relatively inelastic demand curve clue to a large number of substitutes. D. highly or relatively inelastic demand curve due a few substitutes. 30. TRUE or FALSE Excess Capacity, one of the inefficiencies of monopolistically competitive firms means that economic resources are often under-utilized. 31. Which of the following is NOT a basic characteristic of monopolistic competition? A. The use of trademarks or brand names among firms to compete. B. Recognized mutual interdependence among the firms. C. Product differentiation among firms selling substitute goods. D. A relatively large number
