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50 Cards in this Set

  • Front
  • Back
the concept of monopoly is ambigious because
anyone can be shown to be a monopolist if the product is defined narrowly enough
suppose we wish to use the strict definition of "monopoly". Then we could claim that Hallmark is not a monopoly because, in the real world
there ARE substitutes for Halmark cards
suppose we wish to use the strict definition of "monopoly". Then we could claim that Hallmark IS a monopoly because
Hallmark is the sole producer of Hallmark cards
suppose we wish to use the strict definition of "monopoly". Then we could claim that Harvard University IS NOT a monopoly because
there are alternatives to a Harvard education
Using the definition of monopoly as the "sole seller" of a good, pick the true statement below
Both of these are true
A. McDonald's is not a monopoly because it is not the sole seller of hamburgers
b. McDonald's IS a monopoly because it's the sole seller of big mac's
No seller is a monopolist in the strict sense of the word because
no demand curve is completely inelastic
Market power is ____ related to the elasticity of demand
Why were business corporations so frequently identified with MONOPOLIES in the early 19th century?
corporations at this time very commonly enjoyed goverment-granted priviliges not available to others
Price-takers differ from price-searchers in which of the following ways? Price-searchers
will not loose all their sales if they raise their prices above what competitors are charging
The demand curve faced by an airline selling tickets from LA to NY will tend to be more elactic
the larger the number of airlines competing on the route
The logical principle for maximization can be stated as follows:
Do it if the benefit from doing it is greater than the cost of doing it
Marginal revenue for price taker is
equal to price
When does a price-searcher's marginal revenue curve lie below its demand curve?
when it cannot confine price reductions to the new sales it's trying to attract by lowering its price
A firm selling in price-takers market
faces a perfectly elastic demand curve
Sellers who find that the demand for their product is relatiely inelastic at the price currently being charged
could increase their net revenue by raising the price
Price discrimination by sellers usually results in
new and additional opportunities for some buyers
Price discrimination by sellers is usually observed only in situations where
seelers can effectively identify customers by their demand for the product
The fuction of the financial statement which colleges ask parents to fill out to make their children eligible for tuition scholarships is to
provide information about the deman curves of potential customers
Why are prices for groceries and household items typically higher at a 24 hour convenience store compared to similar stores that are open from 6am to 11 pm?
shoppers options are generally fewer in the middle of the night
Movie theaters usually set lower prices for children than for adults because
they suspect that,at the regular or adult price, the deman for children is very elastic
Restaurants catering to both a lunch and a dinner trade are likely to mark their prices up above the cost of the food nore for dinner than for lunch because
the deman is less elastic at dinner
If grocery stores in high-crime areas charge higher prices than stores elsewhere, it is because
there is less competition in high crime areas
Publishers charge much higher prices for a book in hardcover than for the same book in paper cover because
the demand for hardcover books is less elastic at the same price
The word olligopoly means
few sellers
Government licensing of occupations or trades
is often controlled by firms in the licensed industry to prevent competition
The basic federal "antitrust" law prohibiting combinations in restraint of the trade and attempts to monopolize is the
The Sherman act
The merger of two daily new york city newspapers would be an example of a
horizontal merger - The combining of two companies in the same industry
Mergers between companies that previously existed in a supplier-buyer relationship is called a
vertical merger
who is most likely to benefit from a law that requires people who want to enter the taxicab business to prove that they are thoroughly competent, honest, and reliable before they can obtain a license
owners of taxicab licenses
If Safeway reduced its grocery prices below cost in a particular metropolitan area and kept them there until all other grocery stores in the area had been force into bankrupcy, Safeway would almost certainly sustain a huge net loss
in the short run and the long run because grocery stores would reappear quickly when Safeway subsequently set very high prices
Who is likely to be most persistent about complaining to state regulatory authorities taht unlicensed movers are defrauding customers?
licensed movers
Cartels rarely succeed for long because the find it difficult to
keep members from offering discounts and new firms from entering
Fill in the blanks: Other things constant, if the elasticity of demand _____, the market power of the firm _______
decreases (less competition), increases (more profit)
T/F-In a real free-market or capitalist economy, corporations would still be able to get corporate welfare and they would enjoy the benefits of trade restrictions such as quotas and tariffs to protect them from foreign competition
T/F-In a real free-market, people would have to suffer the consequences of second-hand smoke at bars and restaurants
false - NO because nobody would force them to be at those bars
T/F-In a real free-market, there would be no discrimination laws telling businesses who they could and could not serve or hire
T/F-John Stossel in Greed argued that John D. Rockeffeller is an example of somebody who took advantage of consumers and taht it was customers who complained about him?
T/F-One major point of the Greed video was that the profit-seeking motive was a good way to benefit customers?
true - because better products would be made
T/F-In is America#1?, it was clear that socialism worked much better than capitalism in India?
false -socialism hindered the economy
T or F -Dinesh D'Souza argued that one clear, objective measure of whether or not a country is doing well is to see how many people want to leave the country
T o F -William anderson in his article claimed that wal-mart destroys communities
T or F -I argued that it is hypocritical when people claim price gouging or rip-offs on the part of business but they feel perfectly fine when they are the sellers or when they want to pay as little as possible
T or F -In a real free-market, I or any other guy would be able to use power of gvt through legislation to date Pam Anderson or Lindsay Lohan
T o F - Thomas Di Lorenzo in "Anti-trust, Anti-truth" claimed that John D. Rockefeller and other "robber barons" restricted output and lowered prices on their products
I mentioned that James Barksdale, former CEO of Nestcape, wa a hypocrite because
Netscape Navigator had about 80-90% of the market and that he had no problem with that and did not view himself as a monopolist
T/F -According to supporters of free-markets the only real monopolies are the gvt or businesses that have gvt-granted privilege?
T/F - I argued in my article "antitrust is anticompetitive" and in class that it is anticompetitive if Starbucks demanded that a mall prevent the opening of a competing coffee chain as the condition for them to open shop in the mall?
T/F - In the same article, it was argued that Las Vegas tourists would be exploited by higher prices if the merger between MGM and Mandalay takes place?
T/F - Discrimination in one form or another is practiced by everybody?
In the readigs, antitrust laws were characterized as necessary for an efficient competitive market to operate?