Monopoly and Oligopoly Quiz

Monopoly and Oligopoly: ten practice questions on market-power concepts and calculations. Every answer is explained.

Free, with no sign-up.

For High school students and adults reviewing the topic.

About 14 minutes. 10 questions.

How does it work?

Choose one answer or enter a number in the stated unit, then check it.
Read the explanation after answering.
Round only the final answer to the precision requested.

What will you get?

Review your score and the reasoning for each answer.

Question 1A single-price seller faces P = 90 − 3Q and marginal revenue MR = 90 − 6Q, in dollars per unit. Marginal cost is $18 per unit. Find the positive output where MR = MC, in units rounded to two decimal places.

Enter a number in units.

Answers within 0.005 units of the expected value are accepted.

Question 2Demand is P = 76 − 2Q in dollars per unit. A seller has selected Q = 14 units. Find its price in dollars per unit, rounded to two decimal places.

Enter a number in dollars/unit.

Answers within 0.005 dollars/unit of the expected value are accepted.

Question 3An illustrative monopoly sells 9 units while competition would supply 18. Across the missing units, the demand-minus-cost gap falls linearly from $27 to zero. Find the triangular deadweight loss in dollars, rounded to the nearest cent.

Enter a number in dollars.

Answers within 0.005 dollars of the expected value are accepted.

Question 4The three largest independent suppliers have shares of 34%, 26%, and 17%. Find their combined concentration ratio in %, rounded to one decimal place.

Enter a number in %.

Answers within 0.05 % of the expected value are accepted.

Question 5The display shelf shows many labels, but a single parent sets their prices. What count best informs an assessment of competition?

The number of independently run businesses behind the labelsThe number of printed product labelsThe number of brands with distinct advertising campaignsThe number of units stocked under each label

Question 6A sole supplier cannot cover its equipment and staffing costs from sales. What follows?

The firm earns profit once it is called a monopolyMonopoly status does not ensure positive profitIts costs cease to matter without a direct rivalThe firm is competitive because it makes a loss

Question 7A major supplier delays a price cut while estimating rival responses. Which feature of oligopoly explains that decision?

Prices are assigned independently of firms’ decisionsA large supplier’s customers are unable to switch sellersThe smallest firm determines the market by itselfEach major firm’s choices affect the others

Question 8Several firms raise prices after a shared input becomes more expensive. What can be concluded about collusion from that observation alone?

Cost increases prevent firms from discussing pricesThe size of the increase identifies who organized a cartelMatching prices establish a communicated agreementA common cost shock provides another explanation

Question 9Duplicating a local network would require another large fixed investment for the same customers. Which comparison tests whether one network serves them at lower cost?

The public benefit created by spending more on constructionThe service costs under shared or duplicated infrastructureThe disappearance of fixed costs after a second network opensThe number of distinct brands displayed on the pipes

Question 10A regulator requires access to a network on specified terms while leaving ownership intact. What kind of remedy is this?

A removal of the supplier’s physical infrastructureA finding that market power has already disappearedA rule governing the supplier’s future conductA division of ownership among separate firms

Answer every question to see and share your score.

Read the topic guide