Question : 71) Natural barriers to firms to entering an industry include A) : 1384241

71) Natural barriers to firms to entering an industry include

A) control or ownership of the entire supply of an essential raw material.

B) large economies of scale in the industry.

C) a government-awarded franchise.

D) a patent which allows production by only the patent holder.

E) increasing-cost production.

72) A likely cause of a natural monopoly occurring in some industry is

A) scale economies.

B) patents.

C) licenses.

D) charters.

E) sabotage.

73) If an industry’s demand conditions allow at most one firm to cover its costs while producing at its minimum efficient scale (MES), this situation is known as

A) a discriminating monopoly.

B) a natural monopoly.

C) declining marginal revenue.

D) limited competition.

E) natural economic limits.

74) Suppose the technology of an industry is such that the typical firm’s minimum efficient scale is 8000 units per month at an average long-run cost of $5 per unit. If the total quantity demanded at a price of $5 per unit is 8500 units per month, the likely result would be

A) a cartel.

B) a concentrated oligopoly.

C) a natural monopoly.

D) price discrimination.

E) perfectly competitive firms.

75) Suppose the technology of an industry is such that the typical firm’s minimum efficient scale is 18 units per day at an average long-run cost of $1600 per unit.  If the total quantity demanded at a price of $1750 per unit is 16 units per month, the likely result would be

A) a competitive industry.

B) a cartel.

C) price discrimination.

D) a natural monopoly.

E) a concentrated oligopoly.

76) Suppose the technology of production is such that the typical firm’s minimum efficient scale is 1400 units per week at an average long-run cost of $9 per unit. If the total quantity demanded in this market at a price of $9 per unit is 22 million units per week, the likely result will be

A) a cartel.

B) price discrimination.

C) a natural monopoly.

D) a concentrated oligopoly.

E) a competitive industry.

77) If a competing firm is able to overcome an entry barrier of a monopolized industry, the demand curve of the single firm already in the industry will

A) shift to the right.

B) remain the same in spite of the entry of the other firm.

C) shift to the left.

D) become less elastic.

E) shift to the left and become more elastic.

78) A firm is best described as a natural monopoly if

A) there are no competing firms.

B) it holds an exclusive charter from the government.

C) its ATC curve is upward sloping.

D) its MC curve is downward sloping.

E) it can supply the entire market while minimizing its average costs.

79) The main argument of Joseph Schumpeter’s idea of “creative destruction” is that

A) the existence of monopolies leads to destruction of the environment.

B) short-run profits created by the existence of monopolies will lead to antitrust legislation, which will force the fragmentation of monopolies into competitive industries.

C) perfectly competitive industries are characterized by more productive innovation and productivity growth than monopolistic industries, which Schumpeter regarded as destructive.

D) monopoly profits lead to innovation in an effort to sustain those profits.

E) monopolies create profits for themselves at the expense of the destruction of consumer surplus.

80) A number of firms agreeing together to restrict output and thereby raise prices is known as

A) a monopoly.

B) a natural monopoly.

C) a cartel.

D) a barrier to entry.

E) an oligopoly.