A7) Suppose that a monopolist has a marginal cost of 4. Suppose that the market demand is Q(P) = 12 –P. Assuming that the monopoly maximizes its profit, what is the resulting deadweight loss? a) 25 b) 0 c) 5 d) 14 e) none of the above

A7) Suppose that a monopolist has a marginal cost of 4. Suppose that the market demand is Q(P) = 12 –P. Assuming that the monopoly maximizes its profit, what is the resulting deadweight loss? a) 25 b) 0 c) 5 d) 14 e) none of the above

Economics:

10th Edition

ISBN:9781285859460

Author:BOYES, William

Publisher:BOYES, William

Chapter25: Monopoly

Section: Chapter Questions

Problem 14E

See similar textbooks

Related questions

Q: Suppose that a monopolist offers two different products with demand functions P1 = 56 – 491 - P2 48…

A: Given Monopolist demand function for two different market is p1=56-4q1 ....(1) p2=48-2q1…

Q: 1. A profit maximizing monopolist has the following demand and cost functions: P =80–20 TC = Q²…

A: Given information P=80-2Q TC=Q2+8Q+20 Firm is monopolist and profit maximizing firm.

Q: The market demand function faced by an monopoly manufacturer is P=1000–10Q, and the manufacturer's…

A: Monopoly refers to the market structure which has a single seller, selling the good that has no…

Q: Suppose that a monopolist offers two different products with demand functi P1 = 56 – 491 P2 = 48 –…

A: Profit = Total Revenue (TR) - Total Cost (TC) Total Revenue is the revenue of both the products. So,…

Q: Consider a monopolist with a demand equation P = 60 - 2Q, where P is the price in dollars and Q is…

A: P = 60 - 2Q We know the monopolist produces at a point where MR = MC here , MC = $20 TR = P*Q…

Q: Problem 4. (Bundling) Consider a case where there are three consumers with respective valuations for…

A: Answer - "Thank you for submitting the question. But, we are authorized to solve only 3 sub parts.…

Q: A monopolist has no fixed costs and a constant marginal cost equal to $4 per unit. It faces the…

A: Monopoly refers to the market structure which has a single seller, selling the good that has no…

Q: 1) A monopoly always operates in the inelastic portion of its demand curve 2) A specific tax imposed…

A: 1) FALSE. The monopolist generally tries to operate in elastic portion of the demand curve because…

Q: True/False: A monopolist will always be able to operate at a profit. Group of answer choices True…

A: A monopolist is a single seller, selling a product which does not have substitute in the market.…

Q: A monopolist has determined that at the current level of output the price elasticity of demand is…

A: A monopoly is the sole supplier of the good in the market and therefore a monopoly firm faces the…

Q: Total revenue is in dollars and x is the number of units. Suppose that in a monopoly market, the…

A: a) Demand function : p= 480-0.1x Total revenue = Price x Quantity Units sold, x = 500 Therefore,…

Q: Dead weight loss occurs in Monopoly market because-[More than 1 correct option] Price charged by a…

A: Note: In the BNED Guidance, only the first question can be answered at a time. Resend the question…

Q: For a monopolist's product, the demand function is p= 95-0.05g and the cost function is c= 400 +…

A: Monopoly consists of a single seller who produces a unique good that has no close substitutes with…

Q: A monopolist faces a demand curve P = 210 - 3Q and faces a constant marginal cost MC = 15.…

A: In economics, profit maximization is the short run or long run process by which a firm may determine…

Q: A monopoly electricity producer serves two types of customers, business (B) and house- hold (H). The…

A: Since, you have asked multiple questions, we will be answering the first one for you. If you want…

Q: On the market of good Y there are 70 identical consumers. Each consumer has a demand function…

A: In a two-part tariff, a monopolist charges two types of fees, namely: 1. Access fees/ Fixed fees 2.…

Q: An agribusiness firm is a monopoly in the market of a herbicide. The marginal cost is equal to 20…

A: The price function is given as follows: The total revenue can be represents as follows:…

Q: P1 = 56 – 4q1 P2 = 48 – 2q2 The monopolist's joint cost function is C(q1, 42) qỉ + 5q,92 + qż

A: A monopolist offers two different products with demand function. p1 = 56 - 4q1 p2 = 48 - 2q2…

Q: A monopolist has constant marginal cost equal to 30 and faces a market demand curve given by the…

A: (Q) A monopolist has constant marginal cost equal to 30 and faces a market demand curve given by the…

Q: If a monopolist sells 100 units at $9 per unit and realizes an average total cost of $8 per unit,…

A: "Profit is computed by deducting total cost (average total cost multiplied by quantity) from total…

Q: (1) A monopolist is forced to lower its price in order to sell another unit of its product. This…

A: As per the guidelines answer is given to the first question i.e. (1): (1) "A monopolist is a price…

Q: I need an answer for Part D A monopolist is selling in a market with two types of consumers, type H…

A: Answer: Introduction: Monopoly: A monopoly is a market form where there is a single seller and a…

Q: a) What is the per unit cost of the product? b) What are the demand and inverse demand functions?…

A: "Since you have asked multiple parts, we will answer only first three parts for you. If you have any…

Q: Question 2: Suppose a monopoly firm produces bicycles and can sell 10 bicycles per month at a price…

A: Total revenue is the revenue earned by a firms after selling all product Quantity at specific price…

Q: A monopolist faces the following demand curve: P = C = 100 – 5Q + Q². 55 – 2Q. Its cost function is…

A: Since you have posted a question with multiple sub-parts, we will solve the first three subparts for…

Q: A monopolist faces the demand curve illustrated below. 12 11 9. 10 11 12 13 11 15 16 17 18 19 20 21…

Q: 1) Suppose that a monopolist producing bicycles can divide the aggregate demand into two groups: The…

A: a) Given information: y1 = 1200- 10p1 y2 = 800 - 10p2 C(y) = 50y y = y1 + y2 MC = 50 When the…

Q: The quantity demanded, Q, of a monopolist’s product is a function of price, P, as given by the…

A: Monopoly is the single firm in the market producing unique good.

Q: supply-chain relations with the world's major coffee-producing countries. Thus, Starbucks coffee…

A: TR(Total revenue) is the product of p(price) and q(quantity). MR(marginal revenue) is the slope of…

Q: Kalamazoo Competition-free Concrete (KCC) is a local monopolist of ready-mix concrete. Its annual…

Q: Suppose that a monopolist has a marginal cost of 4. Suppose that the market demand is Q(P) = 12 −…

A: Deadweight loss is the loss to the society due to the inefficient quantity produced. A competitive…

Q: Suppose a discriminating monopolist is selling a product in four separate markets in which demand…

A: A monopolist is a firm that either engaged in selling a differentiated product or a unique product.…

Q: [Q: 11-9520945] Suppose a single-price monopolist faces an inverse demand curve given as P(Q)=110-6Q…

A: Monopolist is the single seller in monopoly market and sell the product to large numbers of buyers.…

Q: XYZ company uses a technology for producing its good. This enables the firm to meet the entire…

A: A monopoly is the sole producer of the good in the market, thus having the maximum market power.…

Q: Suppose that the monopolist can produce with total cost: TC 20Q. Assume that the monopolist sells…

A: The Monopoly firm can exercise the price discrimination to increase the profit level. Firm tends to…

Q: Assume a single-price monopolist has an inverse market demand curve given by P(Q)=300-0.5Q, and has…

A: P(Q)=300-0.5Q Q = 600 - 2P C(Q)=125+20Q+0.5Q2. MC = dC/dQ MC = 20 + Q Quantity = 140 units Economic…

Q: 4. A monopolist produces exactly the same product at three plants with respective costs C = Q1 + Qỉ…

A: Since the profit is the difference between total revenue (TR) and total cost (TC) , It can be…

Q: Q (units) P ($) TC ($) 6. 32 1 28 20 2 24 34 Consider a monopolist that faces a demand 3 20 48 4 16…

A: A monopoly is an imperfect market structure that has the highest level of competition. In this…

Q: True/False with explanation: Monopolist will never operate in the inelastic portion of the demand…

A: In a monopoly, there is a single seller who has full control over the prices.

Q: #1 A monopoly sells its good in the U.S. and Japanese markets. The American inverse demand function…

Q: Given the following demand functions of a discriminating monopolist and the composite cost function,…

A: Profit is the amount earn by monopolist or any firm after reducing the marginal cost from marginal…

Q: On the market of good Y there are 100 identical consumers. Each consumer has a demand function…

A: In two part tariff, a fixed is charged equals to the consumer surplus and per unit price is equals…

Q: 3. A monopolist sells two products x and y for which the demand functions are: x = 50 – Px y = 36 –…

A: We have been given that the demand function for product x and product y as x=50-Pxy=36-Py Monopolist…

Question

A7) Suppose that a monopolist has a marginal cost of 4. Suppose that the market demand is
Q(P) = 12 -P. Assuming that the monopoly maximizes its profit, what is the resulting
deadweight loss?
a) 25
b) 0
c) 5
d) 14
e) none of the above

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Consider a monopolist with a demand equation P = 60 - 2Q, where P is the price in dollars and Q is the quantity. The monopolist is able to produce the output with a constant marginal cost of $20 which is equals to the average total cost. Assume that there is no fixed cost. A. If the monopolist practice single pricing, determine the price, quantity, profit, consumer surplus and producer surplus in this market with the aid of a suitable diagram. Appraise the efficiency in this market. B. If the monopolist were to practice perfect price discrimination, determine the quantity, profit, consumer surplus and producer surplus of the monopolist. Appraise the efficiency in this market. C. Consumers and the society are always worse off in a monopolised market compared to a perfectly competitive market. Do you agree? Examine the two (2) market structures and explain with the help of a suitable market diagram.
A monopolist has constant marginal cost equal to 30 and faces a market demand curve given by the following p 100-2Q. If the monopolist is a perfect price discrimination monopolist its level of profit will be equal to (assume there is no fixed cost) A. 1225 B. 2450 C. 2275..... D. 1150
XYZ company uses a technology for producing its good. This enables the firm to meet the entire market demand at a lower price than its two competitors. What factor makes XYZ company a monopolist? a. increasing average total costs. b. a legal barrier to entry. c. Knowledge of exclusive production techniques d. All of these
Assume that a monopolist faces a demand curve for its product given by: p=130−3q Further assume that the firm's cost function is: TC=490+10q What is the profit for the firm at the optimal quantity and price?
All consumers are alike and each has an demand curve for a monopolist’s product of P=100-2Qd. The marginal cost of production is constant at MC = $10. Let the monopolist charge a price of $10 per unit purchased and a subscription fee of $2025 that must be paid by each purchaser. What is the amount of consumer’s surplus left over by this scheme?
2) Suppose that consumers of a good can be represented by the demand function Q (P) = 50 - P. The good is manufactured by an upstream monopolist with cost function C (q) = Q2 + 2Q + 10. A downstream monopolist resells the good to consumers (without further production activity) (a) Determine the industry outcome, profits and consumer surplus. (b) Consider a vertical merger. Compare the industry outcome, profits and consumer surplus to part (a). (c) Suppose the upstream monopolist franchises the product to the downstream firm. Which two - part tariff should the upstream monopolist choose? Determine the profits of the firms.
The marginal cost of production is $4, and assume there is no fixed cost. The farmer is the only seller in the market so it will be a monopoly seller. Suppose the demand for the apple is p=32-2q. 1. What is the monopolist's optimal price 2. At this price, what is the buyer surplus? What is the seller surplus?
Suppose that the inverse demand for a product is represented by the equation P = 120 – 10Q, where P is the price in Euros and Q is the annual output. Suppose that only one firm produces this product and that the marginal and average cost is €20. What is the monopolist’s profit maximizing price assuming that it has to charge a single price to each consumer? A. 5 B. 10 C. 35 D. 70
Assume a single-price monopolist has an inverse market demand curve given by P(Q)=300-0.5Q, and has a cost curve: C(Q)=125+20Q+0.5Q2. We already know that Monopolist will provide 140 units, Economic profit is 19475, and Economic Rent is 190. If the impact of a 35% ad valorem tax imposed on the consumers in the market. Then: Q1: What is the equilibrium quantity will be sold in the after-tax equilibrium? Q2: What are the economic rents of the monopolist?
ASAP PLZ Suppose a monopolist knows it has two types of customers. The inverse demand for the customers in the first market is P = 50 – Q while the inverse demand for the customers in the second market is P = 40 – 2Q. The marginal cost is €10 in both markets. Suppose the firm wishes to charge a two-part tariff to its customers but it cannot distinguish between the customers in the first and second markets. Calculate the entry (fixed) fee that the firm should charge in these circumstances
Once a monopolist has determined its profit-maximizing (equilibrium) quantity of output, QM, which condition does it use to set the price? Question 9Answer a. None of the other options are correct b. Price = Demand at QM c. Price = Average Cost at QM d. Price = Marginal Cost at QM
Suppose a manufacturer sells to a retailer of its product. Final market demand for the product is given by P = a - bQ. The marginal cost of upstream manufacture is c. The unit costs associated with retailing are zero.(A) Suppose that the two stages are integrated and operated by a monopolist. What would the integrated monoply price of the final product be? What is the profit of the integrated monopolist? (B) Now assume that the two stages are not integrated, and in addition, each stage is a separate monopoly. Solve for the input price (that is, the price the manufacturer sets), the final product price, and the profits of each of the two stages.