Econ 300 Homework #9

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Economics 300 Homework #9 Name _______________________ Due ______________ Part 1 - Complete the Following Chapter Problems: Attach any extra pages to this cover sheet. Chapter 9: Discussion Questions: 2, 4, 5, 9, 10 Problems: 1, 3, 4, 12, 14, 15 Spreadsheet Problems: 1 Appendix Problems: 2 Part 2 – Additional Problems: Attach any extra pages or printouts to this cover sheet. 1. A consultant estimates that the demand for the output of Marston Chemical is represented by the equation Q = 2,000 – 50P. A. If the managers of Marston decide to maximize total revenue instead of profit, at would output rate should the firm operate? What is the revenue-maximizing price? B. Will…show more content…
They then maintained this monopoly by patenting better methods to produce aluminum after their original patent had expired. So Alcoa did the second reason why monopolies arise by getting obtaining and maintain new patents on the production of aluminum. 10. In the short run a monopolist can incur losses because they want to produce where their variable costs can be covered. A monopolist will produce and incur a loss as long as price is greater than his average variable costs. At this point the monopolist will be able to produce and cover all of his veriable costs and some of his fixed costs thus still incurring a loss but less of a loss than he would if he didn’t produce at all. b) A Monopolist can increase his profits in the long run because he has had time to create an optimal size of plant given by the point where short run average total cost is tangent to the long run average cost curve. c) A Monopolist would never knowingly produce in the inelastic portion of the demand curve because he will want to produce where marginal revenue equals marginal costs and in order to make profits marginal revenue must be positive and a positive marginal revenue means that total revenue is increases as quantity sold increases and this only happens in in the elastic portion of the demand curve. Spreadsheet

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