 |
1 | |
The social cost of monopoly power arises because ________________ |
|
| | A) | marginal cost is set equal to marginal revenue |
| | B) | price is less than marginal cost |
| | C) | marginal consumer benefit is less than marginal revenue |
| | D) | marginal cost is less than price and marginal consumer benefit |
|
2 | |
Producer surplus is the excess of ____________ over ________________ |
|
| | A) | revenue, marginal cost |
| | B) | revenue, average cost |
| | C) | revenue, total cost |
| | D) | revenue, accounting cost |
|
3 | |
The overall cost of monopoly is equal to the sum of ____________ and ____________ |
|
| | A) | monopoly profits, externalities |
| | B) | social costs, deadweight burden |
| | C) | monopoly profits, social costs |
| | D) | producer surplus, consumer surplus |
|
4 | |
X-inefficiency arises as a result of __________ |
|
| | A) | inside information |
| | B) | lack of competition |
| | C) | weak government |
| | D) | patents |
|
5 | |
To achieve a takeover of another firm, the predator firm must buy the shares of the victim firm's __________ |
|
| | A) | directors |
| | B) | managers |
| | C) | staff |
| | D) | shareholders |
|
6 | |
If two firms doing the same thing in the same industry join together, this is known as a ____________ |
|
| | A) | vertical merger |
| | B) | horizontal merger |
| | C) | conglomerate merger |
| | D) | hostile takeover |
|
7 | |
In the UK mergers can be referred to the Competition Commission if they create a firm with ___________ of the market |
|
| | A) | 15% |
| | B) | 20% |
| | C) | 25% |
| | D) | 30% |
|
8 | |
Sunrise industries may require support because of |
|
| | A) | imperfections in capital industries |
| | B) | a shortage of skills |
| | C) | the price of new products |
| | D) | a and b |
| | E) | b and c |
|
9 | |
Firms may cluster together because |
|
| | A) | risks of workers fall |
| | B) | they can achieve economies of transport |
| | C) | they can benefit from technology spillover |
| | D) | all of the above |
|
10 | |
Perfect price discrimination allows a monopolist to produce the socially efficient output |
|
| | A) | TRUE |
| | B) | FALSE |
|
11 | |
The Competition Commission in the UK starts with the presumption that monopoly is bad |
|
| | A) | TRUE |
| | B) | FALSE |
|
12 | |
In the UK the Restrictive Practices Court scrutinises agreements between firms to consider if they are in the public interest. |
|
| | A) | TRUE |
| | B) | FALSE |
2002 A McGraw-Hill Online Learning Centre