Question 1 Which of the following is true when there is a lack of seller competi

Question

Question 1 Which of the following is true when there is a lack of seller competition in the market? C Buyers can restrict consumption, forcing price down and decreasing quantity demanded C Sellers can restrict production, forcing price down and decreasing quantity supplied Sellers can restrict production, forcing price up and decreasing quantity demanded C The invisible hand will ensure economic efficiency is always met Question 2 Can government licensing limit market competition? C True False Question3 A profit maximizing monopolist will produce where (choose all correct answers) Marginal revenue equals the price Marginal revenue is less than the price Marginal revenue is greater than the price Marginal revenue equals marginal cost Marginal cost equals the price Question4 All firms that are profit-maximizing, regardless of whether the demand curve is horizontal or downward-sloping, will produce where which of the following is true? Marginal revenue is equal to the price Marginal cost is equal to the price Marginal revenue is less than the price Marginal revenue is equal to marginal cost

Explanation / Answer

1. Ans: Sellers can restrict production, forcing price up and decreasing quantity demanded.

2. Ans: True

Explanation:

Government licensing can prevent new competitors from entering into the industry. This reduces competition in the market.

3. Ans:

4. Ans: Marginal revenue is equal to marginal cost.

Explanation:

This equilibrium condition is for both monopoly and competitive market.

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