Ch 10 - Monopoly Flashcards
A Monopoly is a firm that…
That has no rivals
A firm that sets or picks a price based on its output decision is called…
A price setter
A firm that acts as a price setter possesses…
Monopoly power
Characteristics of a particular market that block new firms from entering it are called
Barriers to entry
If long run average cost declines as the level of production increases, a firm is said to experience…
Economies of scale.
A firm that confronts economies of scale over the entire range of outputs demanded in its industry is a…
Natural Monopoly
Sellers in markets isolated by distance from their nearest rivals have a a degree of…
Monopoly power
An expenditure that ha already been made and cannot be recovered is called…
A sunk cost
In very few cases the source of monopoly power is he ownership of…
Strategic inputs
An important basis for monopoly power consists of special privileges granted by…
Government agencies
In situations where products become more useful the larger the number of users of the product arises with…
Network effects
When marginal revenue is positive then demand is…
Price elastic
When marginal revenue is negative then demand is…
Price inelastic
When marginal revenue is zero, then demand is…
Unit price elastic
The demand curve for a monopoly is…
The industry demand curve
