佛州州立《微观经济学》题库第六版 Ch12.doc

chapter 12 monopolistic competition and oligopoly 430 multiple choice section 12.1 easy1. for which of the following market structures is it assumed that there are barriers to entry? a.perfect competition b.monopolistic competition c.monopoly d.all of the above e.(b) and (c) only easy2. use the following two statements about monopolistic competition to answer this question. i.in the long run, the price of the good will equal the minimum of the average cost. ii.in the short run, firms may earn a profit. a.i and ii are true. b.i is true, and ii is false. c.i is false, and ii is true. d.i and ii are false. easy3. a market with few entry barriers and with many firms that sell differentiated products is a.purely competitive. b.a monopoly. c.monopolistically competitive. d.oligopolistic. easy4. the most important factor in determining the long-run profit potential in monopolistic competition is a.free entry and exit. b.the elasticity of the market demand curve. c.the elasticity of the firms demand curve. d.the reaction of rival firms to a change in price. easy5. which of the following is not regarded as a source of inefficiency in monopolistic competition? a.the fact that price exceeds marginal cost. b.excess capacity. duct diversity. d.the fact that long-run average cost is not minimized. e.all of the above. easy6. monopolistically competitive firms have monopoly power because they a.face downward sloping demand curves. b.are great in number. c.have freedom of entry. d.are free to advertise. test bank chapter 12 sixth editionmonopolistic competition and oligopoly 431 easy7. a monopolistically competitive firm in short run equilibrium: a.will make negative profit (lose money). b.will make zero profit (break-even). c.will make positive profit. d.any of the above are possible. easy8. a monopolistically competitive firm in long run equilibrium: a.will make negative profit. b.will make zero profit. c.will make positive profit. d.any of the above are possible. easy9. what happens to an incumbent firms demand curve in monopolistic competition as new firms enter? a.it shifts right. b.it shifts left. c.it becomes horizontal. d.new entrants will not affect an incumbent firms demand curve. easy10. which of the following is true of the output level produced by a firm in long run equilibrium in a monopolistically competitive industry? a.it produces at minimum average cost. b.it does not produce at minimum average cost, and average cost is increasing. c.it does not produce at minimum average cost, and average cost is decreasing. d.either (b) or (c) could be true. easy11. which of the following is true in long run equilibrium for a firm in a monopolistic competitive industry? a.the demand curve is tangent to marginal cost curve. b.the demand curve is tangent to average cost curve. c.the marginal cost curve is tangent to average cost curve. d.the demand curve is tangent to marginal revenue curve. easy12. which of the following is true for both perfect and monopolistic competition? a.firms produce a differentiated product. b.firms face a downward sloping demand curve. c.firms produce a homogeneous product. d.there is freedom of entry and exit in the long run. easy13. which of the following is true for both perfectly competitive and monopolistically competitive firms in the long run? a.p=mc. b.mc=atc. c.pmr. d.profit equals zero. chapter 12test bank monopolistic competition and oligopolysixth edition 432 moderate14. which of the following is true in long run equilibrium for a firm in monopolistic competition? a.mc=atc. b.mcatc. c.mcatc. d.any of the above may be true. moderate15. excess capacity in monopolistically competitive industries results because in equilibrium a.each firms output rate is too great to minimize average cost. b.each firms output rate is too small to minimize average cost. c.firms make positive economic profit. d.price equals marginal cost. section 12.2 easy16. the market structure in which strategic considerations are most important is a.monopolistic competition. b.oligopoly. c.pure competition. d.pure monopoly. easy17. in the cournot duopoly model, each firm assumes that a.rivals will match price cuts but will not match price increases. b.rivals will match all reasonable price changes. c.the price of its rival is fixed. d.the output level of its rival is fixed. easy18. a situation in which each firm is doing the best it can, given what its rivals are doing is called a a.nash equilibrium. b.cooperative equilibrium. c.stackelberg equilibrium. d.zero sum game. easy19. which of the following can be thought of as a barrier to entry? a.scale economies. b.patents. c.strategic actions by incumbent firms. d.all of these. easy20. in the _, each firm treats the output of its competitor as fixed and then decides how much to produce. a.cournot model b.model of monopolistic competition c.stackelberg model d.kinked-demand model e.none of the above test bank chapter 12 sixth editionmonopolistic competition and oligopoly 433 easy21. a _ shows how much a firm will produce as a function of how much it thinks its competitors will produce. a.contract curve b.demand curve c.reaction curve d.nash equilibrium curve e.none of the above easy22. which of the following markets is most likely to be oligopolistic? a.the market for corn b.the market for aluminum c.the market for colas d.the market for ground coffees easy23. the market structure in which there is interdependence among firms is a.monopolistic competition. b.oligopoly. c.perfect competition. d.monopoly. moderate24. in comparing the cournot equilibrium with the competitive equilibrium, a.both profit and output level are higher in cournot. b.both profit and output level are higher in the competitive equilibrium. fit is higher, and output level is lower in the competitive equilibrium. fit is higher, and output level is lower in cournot. scenario 1: suppose mountain spring water can be produced at no cost and that the demand and marginal revenue curves for mountain spring water are given as follows: q = 6000 - 5p mr = 1200 - 0.4q moderate25. refer to scenario 1. what is the profit maximizing price of a monopolist? a.$400 b.$600 c.$800 d.$900 e.none of the above moderate26. refer to scenario 1. what will be the price in the long run if the industry is a cournot duopoly? a.$400 b.$600 c.$800 d.$900 e.competition will drive the price to zero. chapter 12test bank monopolistic competition and oligopolysixth edition 434 difficult27. the cournot equilibrium can be found by treating _ as a pair of simultaneous equations and by finding the combination of q1 and q2 that satisfy both equations. a.the reaction curves for firms 1 and 2 b.the market supply curve and the market demand curve c.the contract curve and the market demand curve d.the contract curve and the market supply curve e.the firms supply curve and the firms demand curve section 12.3 easy28. the oligopoly model that is most appropriate when one large firm usually takes the lead in setting price is the _ model. a.cournot b.stackelberg c.game theory d.prisoners dilemma easy29. what is one difference between the cournot and stackelberg models? a.in cournot, both firms make output decisions simultaneously, and in stackelberg, one firm sets its output level first. b.in stackelberg, both firms make output decisions simultaneously, and in cournot, one firm sets its output level first. c.in cournot, a firm has the opportunity to react to its rival. d.profits are zero in cournot and positive in stackelberg. easy30. which of the following is true in the stackelberg model? a.the first firm produces less than its rival. b.the first firm produces more than its rival. c.both firms produce the same quantity. d.both firms have a reaction curve. moderate31. in the stackelberg model, there is an advantage a.to waiting until your competitor has committed herself to a particular output level before deciding on your output level. b.to being the first competitor to commit to an output level. c.to the firm with a dominant strategy. d.to producing an output level which is identical to a monopolists output level. section 12.4 easy32. which oligopoly model(s) have the same results as the competitive model? a.cournot. b.bertrand. c.stackelberg. d.both cournot and stackelberg. test bank chapter 12 sixth editionmonopolistic competition and oligopoly 435 easy33. in which oligopoly model(s) do firms earn zero profit? a.cournot. b.bertrand. c.stackelberg. d.oligopoly firms always earn positive economic profits. moderate34. in the _, one firm sets its output first, and then a second firm, after observing the first firms output, makes its output decision. a.cournot model b.model of monopolistic competition c.bertrand model d.kinked-demand model e.none of the above easy35. in the _, two duopolists compete by simultaneously selecting price. a.cournot model b.nash model c.bertrand model d.kinked-demand model e.none of the above easy36. in the bertrand model with homogeneous products, a.the firm that sets the lower price will capture all of the market. b.the nash equilibrium is the competitive outcome. c.both firms set price equal to marginal cost. d.all of the above. e.the outcome is inconclusive. moderate37. relative to the nash equilibrium in the cournot model, the nash equilibrium in the bertrand model with homogeneous products a.results in the same output but a higher price. b.results in the same output but a lower price. c.results in a larger output at a lower price. d.results in a smaller output at a higher price. e.any of the above may result. moderate38. which statement most nearly describes a nash equilibrium applied to price competition? a.two firms get together and set the price that maximizes joint profits. b.each firm automatically moves to the purely competitive equilibrium because it knows the other firm will eventually move to that price anyway. c.given the prices chosen by its competitors, no firm has an incentive to change their prices from the equilibrium level. d.one dominant firm sets the price, and the other firms take that price as if it were given by the market. chapter 12test bank monopolistic competition and oligopolysixth edition 436 section 12.5 moderate39. two firms operating in the same market must choose between a collude price and a cheat price. firm as profit is listed before the comma, bs outcome after the comma. firm b cheat price collude price firm a cheat price 18, 18 30, 6 collude price 6, 30 24, 24 if each firm tries to choose a price that is best for it, regardless of the other firms price, which of these statements is correct? a.firm a should charge the collude price, firm b should charge a cheat price. b.firm a should charge a cheat price, firm b should charge a collude price. c.both firms should charge a collude price. d.both firms should charge a cheat price. section 12.6 easy40. the oligopoly model that predicts that oligopoly prices will tend to be very rigid is the _ model. a.cournot b.stackelberg c.dominant firm d.kinked demand easy41. in the kinked demand curve model, if one firm reduces its price a.other firms will also reduce their price. b.other firms will compete on a non-price basis. c.other firms will raise their price. d.both (a) and (b) are correct. e.both (b) and (c) are correct. easy42. suppose that three oligopolistic firms are currently charging $12 for their product. the three firms are about the same size. firm a decides to raise its price to $18, and announces to the press that it is doing so because higher prices are needed to restore economic vitality to the industry. firms b and c go along with firm a and raise their prices as well. this is an example of a.price leadership. b.collusion. c.the dominant firm model. d.the stackelberg model. e.none of the above. test bank chapter 12 sixth editionmonopolistic competition and oligopoly 437 easy43. a market structure in which there is one large firm that has a major share of the market and many smaller firms supplying the remainder of the market is called: a.the stackelberg model. b.the kinked demand curve model. c.the dominant firm model. d.the cournot model. e.the bertrand model. easy44. in the dominant firm model, the smaller fringe firms behave like: petitive firms. b.cournot firms. c.stackelberg firms. d.bertrand firms. e.monopolists. easy45. under the kinked demand curve model, an increase in marginal cost will lead to a.an increase in output level and a decrease in price. b.a decrease in output level and an increase in price. c.a decrease in output level and no change in price. d.neither a change in output level nor a change in price. easy46. which of the following is true about the demand curve facing the dominant firm? a.it equals market demand minus fringe firms supply curve. b.it is identical to market demand. c.it equals market demand minus demand facing the fringe firms. d.it is horizontal. moderate47. the kinked demand curve model is based on the assumption that each firm a.considers its rivals output to be fixed. b.considers its rivals price to be fixed. c.believes rivals will match all price changes. d.believes rivals will never match price changes. e.none of the above. moderate48. in the dominant firm model, the fringe firms a.are price takers. b.maximize profit by equating average revenue and average cost. c.determine their price and output before the dominant firm determines its price and output. d.all of the above. e.none of the above. chapter 12test bank monopolistic competition and oligopolysixth edition 438 scenario 2: you are studying a market for which the kinked demand curve model applies. the kinked demand curve is as follows: q = 1200 - 5p for 0 = q 150 q = 360 - p for 150 = q the marginal cost is given as: mc = q difficult49. refer to scenario 2. what is the profit maximizing level of output? a.171.43 b.120 c.150 d.all of the above e.none of the above difficult50. refer to scenario 2. what is the profit maximizing price? a.205.72 b.240 c.210 d.all of the above e.none of the above difficult51. refer to scenario 2. suppose that the marginal cost increases such that: mc = q + 10 what is the profit maximizing level of output? a.171.43 b.120 c.150 d.all of the above e.none of the above difficult52. refer to scenario 2. suppose that the marginal cost increases such that: mc = q + 10 what is the profit maximizing price? a.205.72 b.240 c.210 d.all of the above e.none of the above test bank chapter 12 sixth editionmonopolistic competition and oligopoly 439 difficult53. refer to scenario 2. suppose that the marginal cost falls such that: mc = q - 10 what is the profit maximizing level of output? a.171.43 b.120 c.150 d.all of the above e.none of the above difficult54. refer to scenario 2. suppose that the marginal cost falls such that: mc = q - 10 what is the profit maximizing price? a.205.72 b.240 c.210 d.all of the above e.none of the above section 12.7 easy55. which of the following is not conducive to the successful operation of a cartel? a.market demand for the good is relatively inelastic. b.the cartel supplies all of the worlds output of the good. c.cartel members have substantial cost advantages over non-member producers. d.the supply of non-cartel members is very price elastic. easy56. this market situation is much like a pure monopoly except that its member firms tend to cheat on agreed upon price and output strategies. what is it? a.duopoly. b.cartel. c.market sharing monopoly. d.natural monopoly. easy57. use the following statements to answer this question: i.cartels are illegal in the united states. ii.once price and production levels are agreed upon, each member of a cartel has an incentive to cheat on the agreement. a.both i and ii are true. b.i is true, and ii is false. c.i is false, and ii is true. d.both i and ii are false. chapter 12test bank monopolistic competition and oligopolysixth edition 440 moderate58. if all producers in a market are not cartel members, then the demand curve facing the cartel is a.the market demand curve. b.horizontal. c.identical to the demand curve in the dominant firm model. d.identical to the monopolists demand curve. the following integrated series of questions relates to several sections in the text. scenario 3: suppose a stream is discovered whose water has remarkable healing powers. you decide to bottle the liquid and sell it. the market demand cur