1) which of the following statements is true of price makers? A the supply curve
ID: 1126191 • Letter: 1
Question
1) which of the following statements is true of price makers? A the supply curve of price makers is downward scoping B the demand curve that price makers face is upward sloping C price makers set the price of a good after they determine how much to produce D price makers determine how much to produce after they set the price of the good 2) the pricing rule for a monopolist is: A. P= MR > MC B. P > MR > MC C. P = MR = MC D. P > MR = MC 3) which of the following statements correctly differentiates between a monopoly and a perfectly competitive firm? A. A perfectly competitive firm faces an upward sloping demand curve, whereas a monopoly faces a horizontal demand curve. B a perfectly competitive firm sets its product price at its marginal cost, whereas a monopoly sets the price above its marginal cost. C a perfectly competitive firm faces a horizontal demand curve, whereas a monopoly faces an upward sloping demand curve. D a perfectly competitive firm sets its product price above its marginal cost, whereas a monopoly sets its product price equal to its marginal cost. 1) which of the following statements is true of price makers? A the supply curve of price makers is downward scoping B the demand curve that price makers face is upward sloping C price makers set the price of a good after they determine how much to produce D price makers determine how much to produce after they set the price of the good 2) the pricing rule for a monopolist is: A. P= MR > MC B. P > MR > MC C. P = MR = MC D. P > MR = MC 3) which of the following statements correctly differentiates between a monopoly and a perfectly competitive firm? A. A perfectly competitive firm faces an upward sloping demand curve, whereas a monopoly faces a horizontal demand curve. B a perfectly competitive firm sets its product price at its marginal cost, whereas a monopoly sets the price above its marginal cost. C a perfectly competitive firm faces a horizontal demand curve, whereas a monopoly faces an upward sloping demand curve. D a perfectly competitive firm sets its product price above its marginal cost, whereas a monopoly sets its product price equal to its marginal cost. A the supply curve of price makers is downward scoping B the demand curve that price makers face is upward sloping C price makers set the price of a good after they determine how much to produce D price makers determine how much to produce after they set the price of the good 2) the pricing rule for a monopolist is: A. P= MR > MC B. P > MR > MC C. P = MR = MC D. P > MR = MC 3) which of the following statements correctly differentiates between a monopoly and a perfectly competitive firm? A. A perfectly competitive firm faces an upward sloping demand curve, whereas a monopoly faces a horizontal demand curve. B a perfectly competitive firm sets its product price at its marginal cost, whereas a monopoly sets the price above its marginal cost. C a perfectly competitive firm faces a horizontal demand curve, whereas a monopoly faces an upward sloping demand curve. D a perfectly competitive firm sets its product price above its marginal cost, whereas a monopoly sets its product price equal to its marginal cost.Explanation / Answer
The price makers determine the quantity of the good at the intersection of MR and MC curves and then price it at maximum as per the demand curve of the firm. The correct option is C.
The pricing rule for the monopolst is that the price is always greater than marginal cost which in turn is equal to the marginal revenue. Thus the corret option is P>MC=MR or P>MR=MC. The correct option is D.
A perfectly competitive firm sets its product price at its marginal cost, whereas a monopoly sets the price above its marginal cost. The correct option is B.
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