Global Gas & Electric, a monopoly operating in the northwest Philippines, Is represented in the table below. Global's executives would not provide you any more information than what's in this table, so you'll have to fil in the blanks. Fill in the table ( It to answer the following questions. (The output is measured in thousands of kilowatt hours of electricity.) ) and use

Global Gas & Electric, a monopoly operating in the northwest Philippines, Is represented in the table below. Global's executives would not provide you any more information than what's in this table, so you'll have to fil in the blanks. Fill in the table ( It to answer the following questions. (The output is measured in thousands of kilowatt hours of electricity.) ) and use

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter15: Monopoly

Section: Chapter Questions

Problem 1CQQ

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From the graph you drew to answer Exercise 11.6, would you say this transit system is a natural monopoly? Justify. Use the following information to answer the next three questions. In the years before wireless phones, when telephone technology requited having a wile matting to every home, it seemed plausible that telephone service had diminishing average costs and might require regulation like a natural monopoly. For most of the twentieth century, the national U.S. phone company was AT&T, and the company functioned as a regulated monopoly. Think about the deregulation of the U.S. telecommunications industry that has occurred over the last few decades. (This is not a research assignment, but a thought assignment based on what you have learned in this chapter.)
If public utilities are a natural monopoly, what would be the danger in deregulating them?
ALCOA does not have the monopoly power it once had. How do you suppose their barriers to entry were weakened?
Imagine a monopolist could charge a different price to every customer based on how much he or she were willing to pay. How would this affect monopoly profits?
If a monopoly firm is earning profits, how much would you expect these profits to be diminished by entry in the long run?
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
How does the quantity produced and price charged by a monopolist compare to that of a perfectly competitive film?
Draw a monopolists demand curve, marginal revenue, and marginal cost curves. Identify the monopolists profit-maximizing output level. Now, think about a slightly higher level of output (sayQ0+1). According to the graph, is there any consumer willing to pay more than the marginal cost of that new level of output? If so, what does this mean?
How can a monopolist identify the profit-maximizing level of output if it knows its total revenue and total cost curves?
Classify the following as a government-enforced barrier to entry, a banker to entry that is not government-enforced, or a situation that does not involve a barrier to entry. A patented invention A popular but easily copied restaurant recipe An industry where economies of scale are very small compared to the size of demand in the market A well-established reputation for slashing prices in response to new entry A well-respected brand name that has been carefully built up over many years