monopaolist prodacing in one plant and selling in two market

monopaolist prodacing in one plant and selling in two markets will ach that t price is equal in both markets s profits are equal in both markets marginal revenue is equal in both markets L quantities sold are equal in both markets 27A monopolist cannot simply pass on any increase in averge cost because cost exceeds average cost b. the average cost curve ofren has a positive slope. c. the monopolist\'s demand curve is typically doaward sloping. d. of concerns about excessive profiteering. 28 Anincrease in . monopolist average cost wil led toan) a. increase in price by the same amount, as the mosopolist passes on the price increase. b. increase in price only if marginal cost increases : decrease in price as the monopolist needs to sell more in order to cover increased costs. d increase in price only if che elasticiry of demand is less than 1O 1.0. Some arrue that because they control the whole market and can thus garner all of the benetts monopolies are more likely to foster innovations Statistical evidence 29 b suggests eactly the reverse. c. lacks a firm conclusion. An increase in a monopolist\'s fixed cot wil a. reduce the proft-maximizing level of outpat b. not affect the profit-maximiting level of output. 30 e incrcase the profit-maximizing level of ouput as the monopolist needis to sel more so coner costs 31 Which of the following is the important diffierence berweem perfect and monopolistic competi- tion? a. few sellers rather than b. heterogeneous rather than c. barriers to entry rather than freedom of entry d. long-run positive economic probes rather than zero economic profics 32 competition would be most appropriate when describing which of the following? betwreen contractors when bidding for government contracts b the c much retail trade in the United States of automobiles in the United States the production of whest 33 Under monopolistic competicion the of output implies that b. both c. cost and marginal revenue will increase with additional units of ourput firms can make positive economic profits even in the long run d. in the long run, individual firms will prodace at minimum average cost 34 Free entry and exit nder monopolistic competition means chat in the long nn a. firms will earn economic b. a firm\'s demand curve will be tangent to its average cost curve d. only one firm can survive.

Solution

26.

C) Marginal revenue is equal in both markets.

27.

C) The monopolist demand curve is down ward sloping.

28.

b) Increase in price only if marginal cost increases.

29.

c) Lacks a firm conclusion.

30.

b) Not affect the profit maximizing level of output.

33.

a. Individual firms face down-ward sloping demand curves