8. $6 C. $4 D. $2 18. (using the information in Figure #1). If the short run pri

Question

8. $6 C. $4 D. $2 18. (using the information in Figure #1). If the short run price were $10, then in the long run firms would: A. Continue to receive the economic profit/loss B. Enter the industry C. Exit the industry Chapter 13 Questions 19. Firms under monopoly maximize profit by choosing an output level where: A. P MC B. MR-P C. MR-MC / MC ATC 20. (using the information in Figure #2). If the industry were perfectly competitive, the industry output level would be: A. 4 B. 3 C. 2 D. 1 21, (using the information in Figure #2). A monopolist would maximize profit by producing units. A. 1 B. 2 C. 3 D. 4

Explanation / Answer

Q19
Answer
option C
MR=MC
because the profit is maximum at the marginal profit equal to zero and the marginal profit=marginal revenue-marginal cost
MP=0=MR-MC then MR=MC.

Q20
option A
Q=4
the industry produces at Qs=Qd
and the MC is a short run supply curve.
Q21
Answer
Option B
the monopolist produces at MR=MC, where Q=2 units
Q22
option D

The monopolist charge price at the quantity from demand curve which is $10

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