2 Questions below rely on the following assumptions:P- 40 - .25QMR - 40 - .5QMC = 8 = Average Cost[ Select ]If there is a monopoly firm in this industry, what is the profit-maximizing Pand Q? Andwhat is the total profit?| Select )Suppose the govermment limits the price to no more than $10 per unit for all units.How many total units will the firm sell? What is the total profit?[ Select ]is the profit maximizing Pand Q for the three-firm Cournot oligopoly? Whatthe total profit?[ Select ]* Assume that are seven firms with equal Qs in this Cournot oligopoly. What is theindustry Pand Q at the profit-maximizing equilibrium? What is the total profit?

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Answered: MC = 8 = Average Cost ( Select ) If…

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 32P: Draw the demand curve, marginal revenue, and marginal cost curves from Figure 9.6, and identify the...

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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
1. Asssume the following equations describe the conditions for an unregulated monopoly: Qd = q = 25,000 -100P or P = 250-0.01q TC = 480,000 + 70q + 0.005q2 where Qd is the quantity demanded for the firm, P is the commodity's price in dollars, TC is total cost in dollars, and q is the quantity of output produced. Based upon the above equations, answer the following questions: a. What is the firm's profit maximizing quantity of output? b. What price will the firm charge for the commodity c. What does the firm's total economic profit equal? d. What is the amount of deadweight loss that exists given the monopoly is unregulated? Assume the government is now going to regulate this monopoly, and the regulators want to guarentee the monopolist produces the socially optimal quantity of output. e. What is the socially optimal quantity of output? f. What price would regulators establish to guarantee the monopolist produces the socially optimal quantity of output? g. What does the firm's…
Draw the demand curve, marginal revenue, and marginal cost curves from Figure : , and identify the quantity of output the monopoly wishes to supply and the price it will charge. Suppose the demand for the monopoly’s product increases dramatically. Draw the new demand curve. 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. What do you think about the result? Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Discuss in detail the equilibrium of a firm under monopoly.Q. 3. What do you mean by simple linear regression line. Estimate, Y , given thefollowing data:-Demand 3 4 5 6 7 9 8 10 12 14Price 16 13 10 7 7 5 4 3 4 2
Assume the following equations describe the conditions for a monopoly: Qd = 2,000 - 100P TC = 3,500 + 5q + .005q2 Where Qd is the quantity demanded, P is the commodity's price in dollars, TC is the firm's total cost in dollars and q is the quantity of output produced. Based upon these equations, answer the following questions: a. What is the firm's equation for total revenue expressed as a function of quantity? b. What is the firm's equation for marginal revenue expressed as a function of quantity? What is the firm's equation for marginal cost expressed as a function of quantity? c. What is the firm's profit maximizing quantity of output? d. What price will the firm charge for the commodity? e. What would be the socially optimal quantity of output? f. What price would regulators have to establish in order to have the firm produce the socially optimal quantity of output?
Assume the definition of deductible elasticity that gives non-negative figures for normal demand. A monopoly that maximizes profit adapts so that the deductible elasticity is 2 and the price is NOK 500.What must then be the marginal costs of the monopoly? (Answers in whole kroner.)
4. 6) Assume the definition of deductible elasticity that gives non-negative figures for normal demand. A monopoly that maximizes profit adapts so that the deductible elasticity is 2 and the price is NOK 500.What must then be the marginal costs of the monopoly? (Answers in whole kroner.)Fill in your answer here:NOK.
9 [32] A profit-maximizing monopolist is currently selling its product at a price which is 4 times its marginal cost. Accordingly, provided the firm is maximizing profit, the current price elasticity of demand is: A. elastic B. inelastic C. unit elastic [34] Suppose the market demand for caviar is given by Q = 40 - 2P, where Q is quantity demand and P is price. In which range below is the price elasticity of demand in the elastic category? A. 0 < P < 6 B. 30 < Q < 35 C. 12 < P < 15 D. Q > 25
(Figure: Short-Run Monopoly) Look at the figure Short-Run Monopoly. If the firm is trying to maximize its profit, the per-unit profit is: The difference between O and where ATC at output R. The difference between N and where ATC at output R. The difference between N and where AVC at output R. N-P
Consider a natural monopoly with large fixed costs and a constant marginal cost of production, such as supplying water to household. Which condition can be used to regulate such a natural monopoly to ensure that the firm continues to operate while maximizing consumer surplus? Question 23Answer a. Demand = Average Cost b. Demand = Marginal Cost c. Marginal Cost = Marginal Revenue d. Price = Marginal Cost e. Price = Marginal Revenue
True/False 1. In a principal-agent relationship between owner and manager with hidden e§ort, the owner can design a wage scheme that insures the optimal Örst best e§ort by the manager regardless of the risk aversion of the manager. Justify your answer. 2. Consider a monopoly that faces an inverse demand curve and has a linear cost function. The monopoly would be indi§erent when maximizing proÖts between either choosing quantities or choosing prices. 3. A multiproduct Örm that as monopoly power over several products sets lower prices than separate Örms (each controlling a single product) when the products are substitutes or when there are economies of scope. 4. In the dominant Örm model (‡ la Hotelling) an increase in the marginal cost of the dominant Örm (with constant marginal costs) implies that proÖts necessarily decrease. 5. Suppose that an industry has 10 Örms where the market shares are ordered from the most to the least dominant Örm f0:5; 0:37; 0:05; 0:03; 0:02; 0:01;…
A monopoly’s inverse demand function is p= 100 - Q + (5A-A2)/Q: where Q is quantity, p is price and A is the level advertising. Its marginal cost of production is constant at 10 and its cost of a unit of advertising is 1. What are the firm’s profit-maximizing price, quantity, and level of advertising? Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.

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