6.When a regulatory agency requires a monopolist to use average cost pricing, the intent is to produce the quantity where the:

A)   marginal revenue curve intersects the marginal cost curve.

B)   marginal revenue curve intersects the demand curve.

C)   the market demand curve intersects the average total cost curve.

D)   average total cost curve intersects the marginal revenue curve.

7.Which of the following statements regarding monopolies is FALSE?

A)   Monopolists will try to get favorable treatment from the government called rent seeking.

B)   Due to the law of diminishing returns, natural monopolies exhibit an upward sloping average total cost curve.

C)   Inefficient producers are able to survive.

D)   Supply to consumers is limited.

8.In a natural monopoly:

A)   one firm controls all natural resources.

B)   the government reserves the industry sector dealing with natural resources for a few firms only.

C)   the price charged by a monopolist is determined by the intersection of the demand curve with the marginal cost curve.

D)   the average total cost of production continually declines with increased output.

9.Which of the following is least likely to be considered a reason for the existence of a natural monopoly?

A)   Firms that can maximize profit when price equals marginal cost.

B)   Firms that have significant economies of scale.

C)   Firms that have significant economies of scope.

D)   Firms for which average total cost decreases over the entire range of industry demand.

答案和详解如下：

6.When a regulatory agency requires a monopolist to use average cost pricing, the intent is to produce the quantity where the:

A)   marginal revenue curve intersects the marginal cost curve.

B)   marginal revenue curve intersects the demand curve.

C)   the market demand curve intersects the average total cost curve.

D)   average total cost curve intersects the marginal revenue curve.

The correct answer was C)

When a regulatory agency requires a monopolist to use average cost pricing, the intent is to price the product where the average total cost curve intersects the market demand curve. There are problems in using this method, e.g., determining exactly what the average total cost really is.

7.Which of the following statements regarding monopolies is FALSE?

A)   Monopolists will try to get favorable treatment from the government called rent seeking.

B)   Due to the law of diminishing returns, natural monopolies exhibit an upward sloping average total cost curve.

C)   Inefficient producers are able to survive.

D)   Supply to consumers is limited.

The correct answer was B)

Natural monopolies have economies of scale that are so pronounced their average total cost curve is downward sloping in the region of relevant market demand.

8.In a natural monopoly:

A)   one firm controls all natural resources.

B)   the government reserves the industry sector dealing with natural resources for a few firms only.

C)   the price charged by a monopolist is determined by the intersection of the demand curve with the marginal cost curve.

D)   the average total cost of production continually declines with increased output.

The correct answer was D)

A monopoly situation in which the average total cost of production continually declines with increased output is called a natural monopoly.

9.Which of the following is least likely to be considered a reason for the existence of a natural monopoly?

A)   Firms that can maximize profit when price equals marginal cost.

B)   Firms that have significant economies of scale.

C)   Firms that have significant economies of scope.

D)   Firms for which average total cost decreases over the entire range of industry demand.

The correct answer was A)

Profit maximization occurs when price equals marginal cost in a perfectly competitive industry, not a monopoly. A natural monopoly exists when economies of scale or scope are so significant that total industry production should be produced by only one firm. In this case, average total cost declines over the entire range of demand.