Question:

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» a. Lower prices if it has lower elasticity

Question:

The point at which the firm covers its variable cost is called:

A.

Point of Inflexion

B.

Equilibrium

C.

Shut down

D.

None of these

Answer» c. Shut down

Question:

Monopolistic competitive firm fixes the price of its product

A.

Independent of the price of close substitutes

B.

Close to the prices of close substitutes

C.

At a very high level

D.

None of the above

Answer» b. Close to the prices of close substitutes

Question:

The larger the number of firms in an oligopoly, the ________ the price and the ________the output of the industry.

A.

lower, greater

B.

higher, lesser

C.

higher, greater

D.

lower, lesser

Answer» a. lower, greater

Question:

Monopolists are said to be allocatively inefficient because:

A.

they produce where mr > mc.

B.

at the profit-maximizing output price is greater than avc.

C.

they produce only the type of product they desire and do not consider the consumer.

D.

at the profit-maximizing output the marginal benefit to society of additional output is

Answer» d. at the profit-maximizing output the marginal benefit to society of additional output is

Question:

In the short run, the monopolist

A.

Breaks even

B.

Incurs loss

C.

Makes profit

D.

Any of the above

Answer» d. Any of the above

Question:

The condition of short run equilibrium under perfect competition is

A.

MC=MR

B.

AC=MR

C.

AC=AR

D.

AR=Selling cost

Answer» a. MC=MR

Question:

Product differentiation is a characteristic of:

A.

Monopoly

B.

Perfect Competition

C.

Monopolistic Competition

D.

Oligopoly

Answer» c. Monopolistic Competition

Question:

Price discrimination is possible:

A.

Under any market form

B.

only under monopoly

C.

only under monopolistic completion

D.

only in perfect competition

Answer» b. only under monopoly

Question:

In a closed economy which of the following is not a macroeconomic objective?

A.

National income growth

B.

price level stability

C.

BOP stability

D.

employment

Answer» c. BOP stability