discussion 4

Le Jouet is a French firm, and it is the only seller of toy trains in France and Russia. Suppose that when the price of toy trains increases, Russian children more readily replace them with toy airplanes than French children. Thus, the demand for toy trains in Russia is more elastic than in France. The following graphs show the demand curves for toy trains in France (Dr) and Russia (DR) and marginal revenue curves in France (MRF) and Russia (MRR). Le Jouet's marginal cost of production (MC), depicted as the grey horizontal line in both graphs, is $12, and the resale of toy trains from Russia to France is prohibited. Assume there are no fixed costs in production, so marginal cost equals average total cost (ATC). PRICE (Dollars per toy train) 40 36 32 28 Total 24 20 16 12 8 4 0 Country France Russia France MR Price (Dollars per toy train) 20 20 2 4 6 8 10 12 14 16 18 20 QUANTITY (Millions of toy trains) N/A O True MC-ATC OF O False N/A (?) Single Price Quantity Sold (Millions of toy…

Are Major League Baseball clubs profit-maximizing monopolies? Some observers of this market have contended that baseball club owners want to maximize attendance or revenue. Alexander (2001) says that one test of whether  a firm is a profit-maximizing monopoly is to check whether the firm is operating in the elastic portion of its demand curve (which he finds is true). Why is that a relevant test? What would the elasticity be if a baseball club were maximizing revenues? (Hint: See Q&A 9.3)

M12

Economics Question

The figure to the right shows an industry composed of a single monopolistic domestic firm. Initially, the firm sells its output exclusively in the domestic market. According to this figure, the profit-maximizing output level is units and the price is $ Now suppose that this domestic monopolist begins to sell in foreign markets as well, where it faces a perfectly elastic demand at $6.00. In the figure, using the line drawing tool, draw the demand curve this firm faces in its foreign markets. Label this line DF- Carefully follow the instructions above and only draw the required object. Now that this firm is operating in two segmented markets, the firm produces units of output and is accused of dumping because: O A. more output (4 units) is sold in foreign markets than at home (2 units). O B. the foreign price of $6.00 is less than the domestic price of $8.00. 10.00- 9.00- 8.00- 7.00- 6.00- 5.00- 4.00- 3.00- 2.00- 1.00- 0.00- 0 Cost, C and Price, P 1 MRDOM MC DDOM 4 9 Quantities produced…

these are practice questions. Assume inverse demand is P=70-12q

I need this example’s solution for my homework.Thank you!

Suppose a country's mobile phone industry is supplied by only two firms (i.e. an oligopoly). Explain how the presence of two firms affects the price elasticity of demand of each firm's output.

In a monopolistically competitive market, the government applies a specific tax of $1 per unit of output. What happens to the profit of a typical firm in this market? Does the number of firms in the market rise or fall? Assume firms are identical in terms of their cost structure (e.g., their cost curves are the same). If a $1 per unit government tax is introduced, then in the short run firm profits will decrease and in the long run the number of firms will decrease until firms earn zero profit

Suppose Clomper's is a monopolist that manufactures and sells Stompers, an extremely trendy shoe brand with no close substitutes. The following graph shows the market demand and marginal revenue (MR) curves Clomper's faces, as well as its marginal cost (MC), which is constant at $40 per pair of Stompers. For simplicity, assume that fixed costs are equal to zero; this, combined with the fact that Clomper's marginal cost is constant, means that its marginal cost curve is also equal to the average total cost (ATC) curve. First, suppose that Clomper's cannot price discriminate. That is, it must charge each consumer the same price for Stompers regardless of the consumer's willingness and ability to pay. On the following graph, use the black point (plus symbol) to indicate the profit-maximizing price and quantity. Next, use the purple points (diamond symbol) to shade the profit, the green points (triangle symbol) to shade the consumer surplus, and the black points (plus symbol) to shade the…

3. How short-run profit or losses induce entry or exit Citrus Scooters is a company that manufactures electric scooters in a monopolistically competitive market. The following graph shows the demand curve, marginal revenue curve (MR), marginal cost curve (MC), and average total cost curve (ATC) for Citrus. Place the black point (plus symbol) on the graph to indicate the short-run profit-maximizing price and quantity for this monopolistically competitive company. Then, use the green rectangle (triangle symbols) to shade the area representing the company's profit or loss. PRICE (Dollars per scooter) 500 450 400 350 300 250 200 150 100 50 0 0 MC 50 100 ATC MR Demand 150 200 250 300 350 400 450 500 QUANTITY (Scooters) Monopolistically Competitive Outcome Given the profit-maximizing choice of output and price, Citrus Scooters is earning Profit or Loss sellers in the industry relative to the long-run equilibrium amount. profit, which means there are

MelCo’s Xamoff The global pharmaceuticals giant, MelCo, has had great success with Xamoff, and over-thecounter medicine that reduces exam-related anxiety. A patent currently protects Xamoff from competition, although rumors persist that similar products are in development. Two years ago, MelCo sold 25 million units for a price of $10 for a package of ten. Last year it raised the price to $11, and sales fell to 22 million units. Finally, a financial analyst estimates the cost of production at $2 per package. (a) Estimate the elasticity of demand for this product at $10. Is this price too high or too low? (b) Estimate the elasticity of demand for this product at $11. Is this price too high or too low? (c) Based on your answers to (a) and (b), what can we say about MelCo’s profit-maximizing price?

Consider any market that has a demand curve given by: Qd = 240 - 2P. Where Qd is the total quantity demanded in the market, given in millions of units and P is the market price, calculated in monetary units. Imagine that there are 2 Cournot oligopolists operating in this market with Cmg = CVme = 15 and fixed monthly costs equal to 1,400. About this market, ask yourself: a) What is the profit of each of the oligopolists? b) Imagine that one of the companies managed to implement a process innovation capable of halving its Cmg and CVme, so that they would go from 15 to 7.5. This investment implies an additional monthly expense of $1,800. Discuss the statement: "If this situation occurs, the innovative company will not implement variable cost reduction, as the quantity supplied in the market will increase very little; prices will remain very close to what they are today and its profits will not increase"

not use ai please

Suppose the European Union (EU) was investigated and proposed a merger between two of the largest distillers of premium Scotch liquor. Based on some economists’ definition of the relevant market, the two firms proposing to merge enjoyed a combined market share of about two-thirds, while another firm essentially controlled the remaining share of the market. Additionally, suppose that the (wholesale) market elasticity of demand for Scotch liquor is −2 and that it costs $16.50 to produce and distribute each liter of Scotch. Based only on these data, provide quantitative estimates of the likely pre- and postmerger prices in the wholesale market for premium Scotch liquor. Instructions: Do not round intermediate calculations. Enter your final responses rounded to the nearest penny (two decimal places). Pre-merger price: $ Post-merger price: $

Suppose the European Union (EU) was investigated and proposed a merger between two of the largest distillers of premium Scotch liquor. Based on some economists’ definition of the relevant market, the two firms proposing to merge enjoyed a combined market share of about two-thirds, while another firm essentially controlled the remaining share of the market. Additionally, suppose that the (wholesale) market elasticity of demand for Scotch liquor is −1 and that it costs $15.70 to produce and distribute each liter of Scotch.Based only on these data, provide quantitative estimates of the likely pre- and postmerger prices in the wholesale market for premium Scotch liquor.Instructions: Do not round intermediate calculations. Enter your final responses rounded to the nearest penny (two decimal places).Pre-merger price: $  Post-merger price: $

encient? Suppose that a company operates in the monopolistically competitive market for electric razors. The following graph shows the demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve for the firm. Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next, place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. 3; 100 50 90 80 88 + 70 70 60 550 40 PRICE (Dollars per razor) 30 30 10 MC 20 20 0 10 10 ATC +. ? Mon Comp Outcome MR Demand 20 30 40 50 60 70 80 90 100 QUANTITY (Thousands of razors) Min Unit Cost

3. How short-run profit or losses induce entry or exit Citrus Scooters is a company that manufactures electric scooters in a monopolistically competitive market. The following graph shows the demand curve, marginal revenue curve (MR), marginal cost curve (MC), and average total cost curve (ATC) for Citrus. Place the black point (plus symbol) on the graph to indicate the short-run profit-maximizing price and quantity for this monopolistically competitive company. Then, use the green rectangle (triangle symbols) to shade the area representing the company's profit or loss. PRICE (Dollars per scooter) 500 450 400 350 300 250 200 150 100 50 0 0 MC 50 100 ATC MR Demand 150 200 250 300 350 400 450 500 QUANTITY (Scooters) Monopolistically Competitive Outcome Given the profit-maximizing choice of output and price, Citrus Scooters is earning Profit or Loss sellers in the industry relative to the long-run equilibrium amount. ? profit, which means there are

Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that P = ATC at the optimal quantity for each firm. Furthermore, the quantity the firm produces in long-run equilibrium is greater than the efficient scale. True or False: This indicates that there is excess capacity in the market True False engines. Monopolistic competition may also be socially inefficient because there are too many or too few firms in the market. The presence of the externality implies that there is too much entry of new firms in the market.

You are the manager of a monopoly. Your analytics department estimates that a typical consumer's inverse demand function for your firm's product is P= 450-40Q, and your cost function is QQ-2900. a. Determine the optimal two-part pricing strategy. Per-unit fee: $[ Fixed fee: $1 b. How much additional profit do you earn using a two-part pricing strategy compared with charging this consumer a per-unit price? $ Ņ

A small town is served by many competing supermarkets, which all have the same constant marginal cost. Use the black point (plus symbol) to show the competitive price and quantity in this market. Then use the green area (triangle symbol) to shade the area representing consumer surplus in the market for groceries, and use the purple area (diamond symbol) to shade the area representing producer surplus. Competitive Market Demand Competitive Outcome Consumer Surplus Marginal Cost Producer Surplus Quantity of Groceries Price, Cost, Revenue

Article: BIZ Community. 2023. Innovative sustainability trends give South Africa's coffee industry a caffeine kick, 21 June 2023. [Online]. Available at: https://www.bizcommunity.com/Article/196/87/239424.html# [Accessed 23 January 2023].   Q.4.1 Defend the use of third-degree price discrimination by Tribeca Coffee when entering new markets. Note: you are required to provide at least two (2) application points. Q.4.2 Identify two (2) common errors in pricing that Tribeca Coffee could be potentially exposed to when entering Ethiopia and recommend ways for the business to minimise the impact of such errors. Q.4.3 Tribeca Coffee has decided to invest in its own fleet of vehicles to move its product across the SADC region. Explain how the business can capitalise on opportunities and minimise the impact of challenges in transportation technology.

10. Competitive Supermarkets A small town is served by many competing supermarkets, which all have the same constant marginal cost. Use the black point (plus symbol) to show the competitive price and quantity in this market. Then use the green area (triangle symbol) to shade the area representing consumer surplus in the market for groceries, and use the purple area (diamond symbol) to shade the area representing producer surplus. Competitive Market Demand Competitive Outcome Consumer Surplus Marginal Cost Producer Surplus Quantity of Groceries Price, Cost, Rev enue

Raphael's hair salon is a monopoly in a small town and is currently earning an economic profit.  Assume that new hair salons enter the market and that the market becomes monopolistically competitive.  a) The entry of new hair salons creates close substitutes for each individual salon's services. As a result, will the demand for Raphael's hair salon become more elastic or become less elastic, or will there be no change in the elasticity? b) Will the entry cause the demand curve for Raphael's haircuts to shift to the left, shift to the right, or stay the same?

As a manager of a chaln of movle theaters that are monopolles in their respective markets, you have noticed much higher demand on weekends than during the week. You therefore conducted a study that has revealed two different demand curves at your movle theaters. On weekends, the Inverse demand function is P= 25 - 0.001Q, on weekdays, It is P= 16 - 0.002Q You acquire legal rights from movie producers to show their films at a cost of $30,000 per movie, plus a $3.50 "royalty" for each moviegoer entering your theaters (the average movlegoer in your market watches a movie only once). What type of pricing strategy should you consider in this case? First degree price discrimination O Block pricing Third degree price discrimination Second degree price discrimination What price should you charge on weekends? Instructions: Enter your response rounded to two decimal places. What price should you charge on weekdays? Instructions: Enter your response rounded to two decimal places. %24

Please help solve all parts of equation

In the following table, which contains the demand schedule for a monopolist, enter the total revenue (TR) and marginal revenue (MR) for each price. For each price–quantity combination (that is, table row), indicate whether demand is elastic, unitary elastic, or inelastic at that point on the demand curve. Hint: Do not calculate the price elasticity of demand mathematically. Instead, use what you know about elasticity along different segments of a linear demand curve to determine the elasticity of each price–quantity combination.