Fill-in-the-Blank
1. Fill in the blanks to make the following statements correct.
a. A perfectly competitive firm faces a demand curve,
whereas a single-price monopolist faces a
demand curve.
b. A single-price monopolist that maximizes profits will
produce at the output where equals
perfectly competitive firm (and industry) produces a level
of output such that price marginal cost. The
monopolist produces a level of output such that price
marginal cost.
c. A monopolist will be earning profits as long as price is
average total cost.
d. At its profit-maximizing level of output, marginal cost for
a single-price monopolist is always the price it
charges for its output.
e. A firm earning monopoly profits is able to maintain those
profits if there are that prevent new firms from
entering the industry.
f. Suppose a gas company has an established distribution
network to supply natural gas to a particular region. This
is likely to be a monopoly because only a single firm
can cover its costs while producing at its.
2. Fill in the blanks to make the following statements correct.