Suppose That the Perfectly Competitive Soybean Industry in the United

question 76

Multiple Choice

Suppose that the perfectly competitive soybean industry in the United States is monopolized. Under perfect competition, the equilibrium price was $2 and quantity was 100,000. The monopolist raises price to $5 and restricts quantity to 70,000. Assume that the monopolist is maximizing profits and that the monopolist faces a linear, upward-sloping marginal cost curve that begins at the origin. Also assume that this marginal cost curve is the industry supply curve under perfect competition. What is the loss in consumer surplus that corresponds to dead-weight loss?

• A)$210,000
• B)$200,000
• C)$90,000
• D)$45,000

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Definitions:

Operant Conditioning

An educational method where the intensity of an action is altered through either rewards or penalties.

Associative Learning

Learning that involves forming connections between stimuli and behavioral responses, enabling organisms to predict outcomes based on their environment.

Classical Conditioning

A learning process that occurs when two stimuli are repeatedly paired; a response that is at first elicited by the second stimulus is eventually elicited by the first stimulus alone.

Long-term Potentiation

A lasting enhancement in signal transmission between two neurons resulting from their simultaneous stimulation, often considered a cellular mechanism for learning and memory.