For a single-price monopoly shown in the figure below, when its profit is maximized, output will be 95 19 15 45 65 MR MC ATC D 65 units per year and the price will be $15. O I choose to use one of my three skips on this question. O 45 units per year and the price will be $19. 65 units per year and the price will be $19. O 45 units per year and the price will be $15.

For a single-price monopoly shown in the figure below, when its profit is maximized, output will be 95 19 15 45 65 MR MC ATC D 65 units per year and the price will be $15. O I choose to use one of my three skips on this question. O 45 units per year and the price will be $19. 65 units per year and the price will be $19. O 45 units per year and the price will be $15.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter9: Monopoly

Section: Chapter Questions

Problem 5SCQ: Suppose demand for a monopolys product falls 50 that its profit-maximizing price is below average...

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Similar questions

Suppose demand for a monopolys product falls 50 that its profit-maximizing price is below average variable cost. How much output should the film supply? Hint: Draw the graph.
How is the perceived demand curve for a monopolistically competitive film different from the perceived demand curve for a monopoly or a perfectly competitive film?
How does the quantity produced and price charged by a monopolist compare to that of a perfectly competitive film?
Draw the demand curve, marginal revenue, and marginal cost curves from Figure 9.6, and identify the quantity of output the monopoly wishes to supply and the price it will charge. Suppose demand for the monopolys product increases dramatically. Draw the new demand me. What happens to the marginal revenue as a result of the increase in demand? What happens to the marginal cost curve? Identify the new profit-maximizing quantity and price. Does the answer make sense to you? Figure 9.6 Illustrating Profits at the HealthPill Monolpoly
What is a natural monopoly?
You are the manager for a monopoly with costs, demand, and marginal revenue as in the graph at the top on Figure 1.a. Does the fact that you operate in a monopoly always guarantee that you can achieve higher prots by increasing the price? Explain.b. Draw the area representing the prots on the top graph on Figure 1.c. Suppose one of your suppliers just announced an increase in prices for a specific part that your product requires. What should the impact be to each of the curves on the top graph of Figure 1? Explain carefully.d. Suppose economic conditions change in such a way that the demand curve for your company shifts left.i. Draw a demand curve on the bottom graph on Figure 1 that leads to zero economic profits.ii. Draw a demand curve on the bottom graph on Figure 1 such that any further leftward demand shift will cause you to shutdown.
Merkel, Inc. has a monopoly in producing coconut oil. Draw a graph to show the profit maximization by Merkel, Inc. Label the profit maximizing quantity, QM. Show that Merkel, Inc. is earning negative economic profit [that is, economic loss]. Label the loss either by shading or by using the letters to define the area. Make sure all the curves, axes and lines are labeled appropriately. Suppose that the coconut oil is produced in a perfectly competitive market. Use the graph you drew for part a) to show the profit maximizing quantity [label it Qc] produced by the perfectly competitive industry. Compare the competitive price with the monopoly price. Does the competitive industry earn loss or the profit situation is different now? Explain. Use the profit situation [loss or economic profit as drawn] to explain the long run adjustment by the firms in perfect competition.
Assume that the demand for electric cars is p = 100-q (where q is the quantity and p is the price), and that an innovation can reduce the constant marginal cost of production from 70 to 60. What is the definition of nondrastic/drastic innovation? Confirm that the innovation for electric cars is nondrastic. Show that marginalcost would have to be reduced to less than 40 for theinnovation to bedrastic. Suppose that the industry is a monopoly (not threatened by entry). Howmuch is this firm willing to pay to acquire the innovation?
COURSE: MICROECONOMICS - MONOPOLY We appreciate a perfect competition market where there is a predetermined limit number of firms with 20 total firms.Each has the cost function such that: CTi = qi2 + 4qi + 3 where qi indicates numbers of firms (i = 20) The demand in the market is: Q = 100 - 4pa) What is the individual supply of each firm? (answered)b) What is the supply of the whole industry? (answered)c) Obtain the market equilibrium (answered)In the case where a new firm intended to enter a monopolist's market:d) What kind of legitimate entry barriers can the firm face understanding the nature of the market it wishes to enter?e) What type of anticompetitive barriers could the firm already in the market present? NOTE: a), b) and c) for perfect competition have been already answered by a tutor; please answer d) and e) questions
Exercise 5. You are the manager for a monopoly with costs, demand, and marginal revenueas in the graph at the top on Figure 1.a. Does the fact that you operate in a monopoly always guarantee that you can achievehigher profits by increasing the price? Explain.b. Draw the area representing the profits on the top graph on Figure 1.c. Suppose one of your suppliers just announced an increase in prices for a specific partthat your product requires. What should the impact be to each of the curves on thetop graph of Figure 1? Explain carefully.d. Suppose economic conditions change in such a way that the demand curve for yourcompany shifts left.i. Draw a demand curve on the bottom graph on Figure 1 that leads to zero economicprofits.ii. Draw a demand curve on the bottom graph on Figure 1 such that any furtherleftward demand shift will cause you to shutdown.
Identify and discuss three ways in which a perfectly competitive market structure differsfrom a Monopoly.
One of these four answers best represents the condition that generates a natural monopoly. Which one? OA single firm controls an industry because there are very few customers in the industry. The government prohibits entry into an industry. O The firm takes anti-competitive actions to keep other firms out. O Economies of scale are large relative to quantity demanded in a market