7. Suppose that the annual number of admissions can be used as a measure of output for a group of hospitals operating in the same RGM (Long Island, NY). Categorize the type of market based on the degree of structural competition as measured by the four-firm concentration ration and the HHI. Number of Admissions (in Hospital thousands) North Shore University Hospital (NSUH) in 4,000 Manhasset NYU Winthrop Hospital in Mineola 3,000 Good Samaritan Hospital Medical Center in West Islip 1,500 Stony Brook University Hospital 2,000 St. Francis Hospital in Roslyn 750

7. Suppose that the annual number of admissions can be used as a measure of output for a group of hospitals operating in the same RGM (Long Island, NY). Categorize the type of market based on the degree of structural competition as measured by the four-firm concentration ration and the HHI. Number of Admissions (in Hospital thousands) North Shore University Hospital (NSUH) in 4,000 Manhasset NYU Winthrop Hospital in Mineola 3,000 Good Samaritan Hospital Medical Center in West Islip 1,500 Stony Brook University Hospital 2,000 St. Francis Hospital in Roslyn 750

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter14: Monopoly

Section: Chapter Questions

Problem 14.3P

See similar textbooks

Similar questions

Intellectual property laws are intended to promote innovation, but some economists, such as Milton Friedman, have argued that such laws are not desirable. In the United States, there is no intellectual property protection for food recipes or for fashion designs. Considering the state of these two industries, and hearing in mind the discussion of the inefficiency of monopolies, can you think of any reasons why intellectual property laws might hinder innovation in some cases?
5. Monopoly versus perfect competition Consider the daily market for hot dogs in a small city. Suppose that this market is in long-run competitive equilibrium, with many hot dog stands in the city, each one selling the same kind of hot dogs. Therefore, each vendor is a price taker and possesses no market power. The following graph shows the demand (D�) and supply (S=MC�=MC) curves in the market for hot dogs. Place the black point (plus symbol) on the graph to indicate the market price and quantity that will result from perfect competition. Perfect CompetitionPC Outcome045901351802252703153604054505.04.54.03.53.02.52.01.51.00.50PRICE (Dollars per hot dog)QUANTITY (Hot dogs)DS=MC Assume that one of the hot dog vendors successfully lobbies the city council to obtain the exclusive right to sell hot dogs within the city limits. This firm buys up all the rest of the hot dog vendors in the city and operates as a monopoly. Assume that this change doesn't affect demand…
There are only two driveway paving companies in a small town, Asphalt, Inc. and Blacktop Bros. The inverse demand curve for paving services is ?= 2040 ―20? where quantity is measured in pave jobs per month and price is measured in dollars per job. Assume Asphalt, Inc. has a marginal cost of $100 per driveway and Blacktop Bros. has a marginal cost of $150. Answer the following questions: Determine each firm’s reaction curve and graph it. How many paving jobs will each firm produce in Cournot equilibrium? What will the market price of a pave job be? How much profit does each firm earn?
Suppose that the market for chicken momos is perfectly competitive with ten firms producing momos. Tasty treat is one of the ten price-takers in the market for momos. The accompanying tables show the demand schedule for momos in Dhaka and cost schedule for "Tasty Treat". DEMAND SCHEDULE Price (BDT per plate) Quantity demanded (plate per hour) 10 900 25 675 30 600 40 450 50 300 70 0 COST SCHEDULE OF TASTY TREAT Output (plate per hour) Marginal Cost (BDT per extra plate) Average Variable Cost (BDT per plate) Average total cost (BDT per plate) 40 20 25 90 50 10 10 75 60 30 20 55 70 50 23 50 80 70 35 60 90 85 50 77 a) What is the value of the shut-down price and break-even price for Tasty Treat?How did you figure that out?b) Write down the individual supply schedule of chicken momos for Tasty Treat and the industry supply schedule for chicken momos.c) Plot the market demand and supply curves for chicken momos and find the equilibrium price and…
5. Monopoly outcome versus competition outcome Consider the daily market for hot dogs in a small city. Suppose that this market is in long-run competitive equilibrium with many hot dog stands in the city, each one selling the same kind of hot dogs. Therefore, each vendor is a price taker and possesses no market power. The following graph shows the demand (D) and supply (S = MC) curves in the market for hot dogs. Place the black point (plus symbol) on the graph to indicate the market price and quantity that will result from competition.
Allocative inefficiency is observed in the case of monopoly where economies of scale is absent. Define the allocative inefficiency and present a diagram which shows allocative inefficiency of profit-maximizing monopoly. Compare the price and profit maximization level of output of monopoly to those of a perfectly competitive market. For comparison’s sake, use the assumption that firms in a perfectly competitive industry were bought by a business person and begins to act as a monopoly.
5. Monopoly outcome versus competition outcome Consider the daily market for hot dogs in a small city. Suppose that this market is in long-run competitive equilibrium with many hot dog stands in the city, each one selling the same kind of hot dogs. Therefore, each vendor is a price taker and possesses no market power. The following graph shows the demand (D) and supply (S = MC) curves in the market for hot dogs.
3) Bookface, the largest online social media network in the world, is being sued for abusing market power and attempting to create a monopoly. To defend his company, its founder Zark Muckerberg claims that in the social media industry, users want to be on whichever platform their friends are, which makes the creation of monopolies inevitable. Prosecutors, however, disagree. They claim that Bookface has used its market power to drive small companies out of the market. a. Which side is right? b. Please discuss this phenomenon and its sources.
Type out the correct answer ASAP with proper explanation 1.Assume inverse demand of P = 20 - 0.2Q where P is the market price and Q is the market demand. Also assume that there are 2 firms who both have a marginal cost of 2. (a) In a Cournot context, what is the equilibrium price, market quantity, and profit for each firm? (b) In a Bertrand context, what is the equilibrium price, market quantity, and profit for each firm?
2. You are the Southeastern Michigan regional manager at Coca-Cola, responsible forproduction and pricing in the Metro Detroit area. Your primary competitor is Pepsi. The marketresearch team at Coca-Cola is thinking about launching a new product, Orange Vanilla Coke, toboost the brand. The cost function to produce a 12-pack of 12 fl. oz. cans of Orange VanillaCoke is C(qcoke) = 0.25qcoke and the market research team has estimated inverse market demandfor a 12-pack of this new “pop” in Southeastern Michigan to be P = 10.25 – 0.00025Q. a. Assuming Pepsi decides not to produce a similar product, allowing Coca-Cola to maintainmonopoly power in the market for orange vanilla cola, what price and quantity will youchoose to maximize profit? How much profit does Coca-Cola earn?b. What price and quantity you would choose to maximize profit if Pepsi spies discover yourproduct before launch, allowing Pepsi to produce and launch an identical product at the sametime. For your answer, assume the cost…
15. Name three definitional conditions of the market model termed monopolistic competition. Explain their major implications for the behavior of the firm. Briefly for managerial economics class
DuopolyMarket for mechanical pencils can be described by the following demand schedule:Price | Number of pencils demanded$6 | 80$5 | 200$4 | 320$3 | 440$2 | 560$1 | 680$0 | 800The fixed cost is $340, while the variable cost is $0.50.d) If there were two firms on the market and they agreed to cooperate, how much would eachfirm need to produce? Follow the procedure outlined in the lecture and show that the otherfirm would prefer to deviate from the agreement.e) When the firms deviate from the agreement, there is a new optimal level of output. Showwhether the firms have an incentive to deviate from that level?f) If there were two firms on the market, what would be the price and the quantity of pencilstraded if the firms couldn’t cooperate?