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Economics

Monopoly

Dept. of Economics @ NCKU


Weng, Ming-Hung
Q1
When MR>0 at
current output level,
the firms total
revenue (TR) will
___ as it produces
more.
1. increase
2. decrease
3. be maximized
4. be minimized
Q2
Price Quantity Marginal Revenue
for the 4th unit is
$10 1
1. $10
$9 2 2. $8
$8 3 3. $6
4. $4
$7 4
5. $2
$6 5
Q3
The monopoly will produce an output

level equal to
1. 400; 2. 500; 3. 600; 4. 800

200 ()
()
170
140
90 ()

500 800
400 600
Ming-hung Weng, Dept. of Economics,
2010/3/21 4
NCKU
Q4
The monopoly will set its price as $

1. 200; 2. 170; 3. 140; 4. 90

200 ()
()
170
140
90 ()

500 800
400 600
Ming-hung Weng, Dept. of Economics,
2010/3/21 5
NCKU
Q5
Quanti If MC=$6, the
Price MR
ty monopoly causes a
deadweight loss
$10 1 10
equal to
$9 2 8 1. $1
$8 3 6 2. $3
3. $5
$7 4 4
4. $6
$6 5 2
Q6

The fair-returns price regulation will set a price


ceiling as P=$
1. 1; 2. 2; 3. 3.5; 4. 6

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