Q. 3 Question 3:a) Create a budget equation and calculate the missing quantities of books andmovies, by using the schedule given below:Income: $100,Books: $5 each.Movie: $10 each.Consumption Books (per Movies (permonth)Possibilitymonth)A10B4AB6.12E16F20b) With the help of a graph, explain the efficiency comparison of monopolisticmarket and perfectly competitive market. Question 2:(a) Calculate the average cost of producing 14 units, where each labor is paid$40 and for each machinery $90 is paid.(Show all the workings).Draw a long-run average cost curve (LRAC) and show, which one has gotthe minimum ATC according to your calculation?Labor / $40Plant 1Plant 2Plant 3151014101814201222203014Сapitalequipment/ $90203040b) If the wage of the labor rises from $50 to $60, what changes will occur in theisocost curve? Draw a graph (no explanation needed)c) If there is a cartel in the oligopoly market, what consequences will occur overthe consumers of that oligopoly market? Explain briefly.

a) Create a budget equation and calculate the missing quantities of books and movies, by using the schedule given below: Income: $100, Books: $5 each. Movie: $10 each. Consumption Books (per Movies (per month) Possibility month) 10 A 4 A C В 6. D 12 E 16 F 20 0. b) With the help of a graph, explain the efficiency comparison of monopolistic market and nerfectly cometitive market

a) Create a budget equation and calculate the missing quantities of books and movies, by using the schedule given below: Income: $100, Books: $5 each. Movie: $10 each. Consumption Books (per Movies (per month) Possibility month) 10 A 4 A C В 6. D 12 E 16 F 20 0. b) With the help of a graph, explain the efficiency comparison of monopolistic market and nerfectly cometitive market

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter16: Monopolistic Competition

Section: Chapter Questions

Problem 8PA

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Exercise 5.1 Describe with the help of graphs the long-term equilibrium of a monopolistically competitive market. What is the relationship between price and ATC? And between the price and the MC?
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GoGo Pizza is producing at the profit-maximizing level of output in a monopolistically competitive market. Show GoGo Pizza’s profit-maximizing level of output, selling price, and a positive profit in a diagram. Briefly explain. Does GoGo Pizza have an incentive to produce at the level of output that maximizes the social welfare? Explain with the diagram from the first question.
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In which type of market, monopolistic or competitive market, is the equilibrium market price lower? Why?