AP®︎ Microeconomics: Topic 4.2 Flashcards

A market structure with one seller protected by barriers to entry.

Obstacles that prevent new firms from entering and competing in a market.

A single firm can supply the entire market at lower cost than multiple firms.

Demand slopes downward, and marginal revenue lies below demand because lowering price affects all units sold.

Produce where MR equals MC, then charge the price on the demand curve.

At the chosen output, price exceeds marginal revenue and is greater than marginal cost.

Consumer surplus shrinks, producer surplus changes, and deadweight loss appears from underproduction.

A regulated price where price equals ATC, so the firm earns normal profit.

Profit or loss equals the rectangle between price and ATC at the MR = MC output.

The allocatively efficient point occurs where demand equals marginal cost, unlike monopoly output.

Total revenue is maximized where marginal revenue is zero and demand is unit elastic.

Average total cost falls as output increases over the entire market demand.