A monopolist knows there are two customers with different demand curves for two differently sized bags of potato chips. Customer S would only buy the small bag and has a willingness-to-pay given by P=160-2q (where P denotes the price and q denotes the quantity). Customer L would buy the large bag and has a willingness-to-pay given by P=200-q. The monopolist does not know who is customer S and who is customer L. Marginal cost of production is zero. BEFORE second degree price discrimination, how large are the bags?

Q: Match the development on the graph to the macroeconomic process that it represents. slide along the…

A: IS curve represent the good market equilibrium where aggregate demand is equal to aggregate supply.…

Q: The economy is currently in a supply - shock recession. Suppose the Fed decides to pursue…

A: Recession is period of falling income, where income is less than potential GDP.

Q: Kolkmeyer Manufacturing Company is considering adding two machines to its manufacturing operation.…

A: Given, Kolkmeyer Manufacturing Company is considering adding two machines to its manufacturing…

Q: Frequent job changes A. increase cyclical unemployment. B. decrease frictional unemployment. C.…

A: Frequent job changes refer to a scenario where individuals frequently switch jobs within a short…

Q: 6. Optimal choice of capital Ginny makes sweaters in her home. She started with just some knitting…

A: Marginal Price Product (MPP) refers to the change in the total revenue a firm receives when it…

Q: If Kate spends her entire $24 on seltzer water, she can buy jars of peanut butter. cases of seltzer…

A: A budget constraint is an economic concept that indicates the maximum amount of goods or services…

Q: Suppose that there are two countries, A and B. The production possibilities frontier of country A is…

A: Both the countries A and B have the similar production possibility frontiers and indifference…

Q: A consumer values a car at $30,000 and a producer values the same car at $20,000. If the transaction…

A: Sales tax is a tax imposed by governments on the sale of goods and services. It is usually…

Q: Explain the necessary and sufficient conditions that must be met for security markets to operate…

A: A security market is a financial marketplace where securities such as stocks, bonds, and other…

Q: of the following choices, which could have shifted Edison's budget constraint from BC₁ to BC₂? Check…

A: Budget constraint It depicts the combination of two goods that can be afforded by a consumer, given…

Q: Suppose that Abel and Eden spend their incomes on two goods, food (F) and clothing (C). Abel’s…

A: In economics, preferences are a summary of customers' choices for consumption bundles, and…

Q: 3. Suppose a perfectly competitive firm is operating at a level of output such that P> MC. Would you…

A: If a perfectly competitive firm is operating at a level of output such that P>MC, it is not…

Q: Figure 33-5. P1 P2 P3 LRAS [B YI Y2 SRASI AD SRAS2 } 28. Refer to Figure 33-5. The shift of the…

A: John Maynard Keynes introduced the AD-AS (Aggregate Demand-Aggregate Supply) model as part of his…

Q: Listen to "Google's Mobile Monopoly" from NPR's Planet Money podcast. (Link here.) Write a short…

A: According to the podcast, Google deterred smart phone operating system competitors by offering the…

Q: Discuss how tax incentives operate within an economy. Illustrate and discuss the possible effects of…

A: Tax incentives are a form of government policy that seeks to influence the behavior of businesses…

Q: An economy is described by the following equations: 1,800+ 0.8 (Y - T) C IP = 1000 PAE= = G = =…

A: Planned aggregate expenditure is a sum of consumption spending, investment spending, government…

Q: Y Real GDP AD

A:

Q: Question 46 Table 28-3 Civilian labor force Persons unemployed 15 weeks or longer Job losers and…

A: People who are actively looking for the work and are able to work are considered unemployed

Q: (Figure: Income and Substitution Effects) Refer to the figure. Which of the following could not…

A: The indifference curve depicts the combination of two goods that derives the same level of…

Q: Planned economies do not have prices. True False

A: A planned economy refers to a type of an economic system in which the government makes all decisions…

Q: When a firm has a fixed input, all of which must be used all the time, it said that input is?

A: The production function links physical amounts of inputs to physical quantities of output. Cost…

Q: 1. Suppose that a pay equity plan has just been put in place in your organization. The pay equity…

A: Wage income is earnings by an employee for engaging in job activity by a business or firm. Pay…

Q: Figure 15-1 Price Level ON OB to point D B to point C B to point A O A to point C D SRAS₂ AD1 SRASI…

A: Short run equilibrium is where the AD curve intersects the SRAS curve.  There is recessionary gap…

Q: Calculate JointJuice’s optimal output level and profits if the market price for the product stays…

A: A perfectly competitive firm is a market system in which several small firms produce similar…

Q: From a theoretical perspective, are CPI and unemployment rate expected to be cointegrated? Justify…

A: CPI stands for "Consumer Price Index." It is a measure of inflation that tracks the changes in the…

Q: Suppose the European Union (EU) was investigated and proposed a merger between two of the largest…

A: Profit maximization is a theory in economics which states that firms strive to maximize their…

Q: Suppose that your economy is in long run equilibrium, then the following shock occurred. The…

A: Monetary Policy: Monetary policy refers to the policy instruments with the central bank of a country…

Q: An essential characteristic of a perfectly competitive market is that sellers: Group of answer…

A: In a perfectly competitive market,  There exists a large number of buyers and sellers.  The firm…

Q: Refer to Exhibit 7-1. What is the value of national income? a. $4,542 Ob. $4,351 c. $2,996 d. $4,252…

A: National income is the value of all the goods and services produced by the normal resident of an…

Q: Question 6 Find the correct numerical value for the following factor from the compound interest…

A: Present value is the value of investment in today's dollar.  Future value is the value of investment…

Q: Suppose the airline industry is an oligopoly with two competing firms, VolAir and ClearJet. Assume…

A: In a oligopoly market structure,  There exists few sellers.  There is barriers to entry and exit in…

Q: n economy with no trade and no taxes is described by the following functions:   C = 750000+ 0.4Y…

A: Equilibrium condition:  Y = C+I The equilibrium occurs where the expenditure is equal to the output.…

Q: Happy Hands is a monopolistically competitive firm that faces the following demand schedule for its…

A: Total revenue is the total receipts from selling the product.  It is calculated as price times…

Q: Question 36 Table 28-3 Civilian labor force Persons unemployed 15 weeks or longer Job losers and…

A: U-2  measure of labor underutisation considers people who lost their jobs, or whose temporary jobs…

Q: You are the manager of a monopoly that sells a product to two groups of consumers in different parts…

A: Lerner index: It states the relationship among price, marginal cost and price elasticity of demand.…

Q: Depict the optimal production and consumption bundles when Canada and India open up to trade with…

A: When a country has comparative advantage in producing a product, means when a country can produce…

Q: Suppose the wage rate is $1000 such that the MRP > VAP. Will the firm want to hire workers? Group of…

A: MRP : Marginal revenue product of labor. This represents the additional revenue the firm would get…

Q: Suppose that the marginal propensity to consume is dC In(y + 1) (in trillions of dollars) dy y+1 and…

A: Marginal prosperity in economics refers to the additional gain that is achieved from producing or…

Q: Based on the Balance of Payments in the table below, what is the statistical discrepancy (with…

A: Balance of payment is an accounting statement that records the economic transactions that take place…

Q: 2. A consumer is in equilibrium at point A in the accompanying figure. The price of good X is $5.…

A: Indifference curve represents different combinations of two good that provide same level of…

Q: When large retailers like Costco offer products at a discounted price because they are able to…

A: A discounted price refers to a reduced cost of a product or service that is offered for sale. The…

Q: Firm B's Advertising Low Budget High Budget Firm A's Advertising Low Budget $100 $120 $100 $60 High…

A: When both firms collude, they work together to maximize the joint payoff. This results in a higher…

Q: Indicate which of the functions of money (a medium of exchange, a unit of account, and a store of…

A: Money has evolved over time, from bartering to the usage of precious metals, paper cash, and digital…

Q: Suppose that two clothing manufacturers, Lands’ End and L.L. Bean, are deciding what price to charge…

A: The fundamental idea of Nash equilibrium in game theory is used to forecast how businesses will…

Q: "With respect to the monopoly equilibrium without price discrimination, first-degree price…

A: First-degree price discrimination, also known as perfect price discrimination, occurs when a company…

Q: Parks confer many external benefits on society: open space, trees that reduce pollution, and so on.…

A: Externalities refer to the effects of an economic activity that spill over onto third parties who…

Q: A company estimates that the total revenue, R, in dollars, received from the sale  of q items is ? =…

A: The revenue function is given by: R(q) = 3000 + ln(1 + 1000q^3) Taking the derivative with respect…

Q: d. Suppose firms B, D, and F wanted to merge. What would be the value of the HHI following this…

A: The HHI is calculated as the sum of squares of the market shares of each firm.  The justice…

Q: If a single-price monopolist faces an inverse market demand function of P(Q)=320-2Q, what is its…

A: The demand curve and MR curve are downward sloping curve.  The MR curve lies below Demand curve.…

Q: In 2018, Nicole taught music and earned $30,000. On January 1, 2019, she quit teaching and started a…

A: Explicit costs are direct and obvious out-of-pocket expenses incurred by a business in the…