Please note: I had to adjust the MC and ATC curves on this problem, but the labels for MC and ATC did not move. So, the dark blue line is the ATC line, and the red line is the MC line. Calculate the firm's profit if they are a single-price monopoly: Profit = $ Calculate the firm's profit if they are a perfect price discriminating monopoly: Profit = $ Calculate the firm's profit if they price discriminate as follows: Sell the first 2500 units at a high price and the rest of the units at a low price: Profit = $ Calculate the firm's profit if they price discriminate as follows: Sell the first 2000 units at a high price, the next 1000 units at a medium price, and the rest of the units at a low price: Profit = $ 30- 28- 26- Price and cost (dollars per unit) 24- 22- 20- 18-17.5 16- 14- 12- 10- 8- 6- 4- 2- 0+ 0.0 MC ATC $2.5 MR 1.0 2.0 3.0 4.0 5.0 Quantity (thousands of units per year) D 6.0

Please note: I had to adjust the MC and ATC curves on this problem, but the labels for MC and ATC did not move. So, the dark blue line is the ATC line, and the red line is the MC line. Calculate the firm's profit if they are a single-price monopoly: Profit = $ Calculate the firm's profit if they are a perfect price discriminating monopoly: Profit = $ Calculate the firm's profit if they price discriminate as follows: Sell the first 2500 units at a high price and the rest of the units at a low price: Profit = $ Calculate the firm's profit if they price discriminate as follows: Sell the first 2000 units at a high price, the next 1000 units at a medium price, and the rest of the units at a low price: Profit = $ 30- 28- 26- Price and cost (dollars per unit) 24- 22- 20- 18-17.5 16- 14- 12- 10- 8- 6- 4- 2- 0+ 0.0 MC ATC $2.5 MR 1.0 2.0 3.0 4.0 5.0 Quantity (thousands of units per year) D 6.0

Economics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506725

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter24: Price-searcher Markets With High Entry Barriers

Section: Chapter Questions

Problem 13CQ

See similar textbooks

Similar questions

One difference between a competitive firm and a monopoly is that __________________. a. monopoly makes economic profits, but a competitive firm never makes economic profits b. a monopoly faces a downward sloping marginal revenue curve, whereas a competitive firm faces a horizontal marginal revenue curve c. the cost curves of a monopoly are always below those of a competitive firm d. a monopoly always has economies of scale, but a competitive firm always has diseconomies of scale
The cost function for producing ethanol from municipal waste (wastehol) is 1000+10q2 where q is in millions/gallons per year. The demand for wastehol is currently perfectly inelastic at 5 million gallons per year. Assume that producers of wastehol are perfectly competitive. California is deciding whether to convert all wastehol producers into a regulated wastehol utility. If wastehol is a regulated monopoly utility with the cost function above, what price would regulators set as the price of wastehol? Now assume that the wasteahol market has boomed and demand has grown to 20 (again million gallons per year). Now what is the regulated price of wastehol? You are the wastehol producer and are trying to decide whther to lobby for deregulating the wastehol industry. If wastehol were deregulated, if demand remains 20, what would the perfectly competitive price be? If you are a wastehol customer, you would prefer a deregulated industry if demand were 20? True/False?
You are the manager of a monopoly, and your analysts have estimated your demand and cost functions as P = 300 − 3Q and C(Q) = 1,500 + 2Q2, respectively. a. What price-quantity combination maximizes your firm’s profits? Price: Quantity: b. Calculate the maximum profits. $ c. Is demand elastic, inelastic unit elastic Elastic d. What price-quantity combination maximizes revenue? Price: Quantity: e. Calculate the maximum revenues. $ f. Is demand elastic, inelastic, or unit elastic at the revenue-maximizing price-quantity combination? multiple choice Elastic Unit elastic Inelastic
You are the manager of a monopoly, and your analysts have estimated your demand and cost functions as P = 500 − 2Q and C(Q) = 2,500 + 2Q2, respectively. a. What price–quantity combination maximizes your firm’s profits? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units b. Calculate the maximum profits. Instructions: Round your response to the nearest penny (two decimal places). $ c. Is demand elastic, inelastic, or unit elastic at the profit-maximizing price–quantity combination? multiple choice 1 Elastic Inelastic Unit elastic
You are the manager of a monopoly, and your analysts have estimated your demand and cost functions as P = 200 − 2Q and C(Q) = 1,000 + 3Q2, respectively. a. What price–quantity combination maximizes your firm’s profits? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units b. Calculate the maximum profits. Instructions: Round your response to the nearest penny (two decimal places). $ c. Is demand elastic, inelastic, or unit elastic at the profit-maximizing price–quantity combination? multiple choice 1 Elastic Unit elastic Inelastic d. What price–quantity combination maximizes revenue? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units e. Calculate the maximum revenues. Instructions: Round your response to the nearest penny (two decimal places). $ f. Is demand elastic, inelastic, or unit elastic at the revenue-maximizing price–quantity…
You are the manager of a monopoly, and your analysts have estimated your demand and cost functions as P = 600 − 3Q and C(Q) = 2,000 + 2Q2, respectively. a. What price–quantity combination maximizes your firm’s profits? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units b. Calculate the maximum profits. Instructions: Round your response to the nearest penny (two decimal places). $ c. Is demand elastic, inelastic, or unit elastic at the profit-maximizing price–quantity combination? multiple choice 1 Unit elastic Inelastic Elastic d. What price–quantity combination maximizes revenue? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units e. Calculate the maximum revenues. Instructions: Round your response to the nearest penny (two decimal places). $ f. Is demand elastic, inelastic, or unit elastic at the revenue-maximizing price–quantity…
Consider a market with a monopoly firm. Sales revenue of this firm is $15,960,000 total cost is $8,680,000 and average cost is $3.10 Another firm wants to enter the market and provide the same product at a lower price. To intimidate the potential competitor, the monopoly firm intends to use predatory pricing.By how much can this firm reduce the price of its product without losses? Enter your answer in the box below and round to two decimal places if necessary.
You are the manager of a monopoly, and your analysts have estimated your demand and cost functions as P = 300-2Q and C(Q) = 1,500 + 2Q2, respectively. a. What price-quantity combination maximizes your firm's profits? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units b. Calculate the maximum profits. Instructions: Round your response to the nearest penny (two decimal places). $ c. Is demand elastic, inelastic, or unit elastic at the profit - maximizing price-quantity combination? multiple choice 1 Unit elastic Elastic Inelastic d. What price- quantity combination maximizes revenue? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units e. Calculate the maximum revenues. Instructions: Round your response to the nearest penny (two decimal places). $ f. Is demand elastic, inelastic, or unit elastic at the revenue - maximizing price-quantity combination? multiple choice 2 Unit elastic Elastic…
ou are the manager of a monopoly, and your analysts have estimated your demand and cost functions as P = 200 − 2Q and C(Q) = 1,000 + 3Q2, respectively. a. What price–quantity combination maximizes your firm’s profits? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units b. Calculate the maximum profits. Instructions: Round your response to the nearest penny (two decimal places). $ c. Is demand elastic, inelastic, or unit elastic at the profit-maximizing price–quantity combination? multiple choice 1 Elastic Unit elastic Inelastic d. What price–quantity combination maximizes revenue? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units e. Calculate the maximum revenues. Instructions: Round your response to the nearest penny (two decimal places). $ f. Is demand elastic, inelastic, or unit elastic at the revenue-maximizing price–quantity…
You are the manager of a monopoly, and your analysts have estimated your demand and cost functions as P = 500 − 2Q and C(Q) = 2,500 + 2Q2, respectively. d. What price–quantity combination maximizes revenue? Instructions: Round your response to the nearest penny (two decimal places). Price: $ Quantity: units e. Calculate the maximum revenues. Instructions: Round your response to the nearest penny (two decimal places). $ f. Is demand elastic, inelastic, or unit elastic at the revenue-maximizing price–quantity combination? multiple choice 2 Inelastic Unit elastic Elastic
Enrodes is a monopoly provider of residential electricity in a region of northern Michigan. Total demand by its 3 million households is Qd = 1,500 − 2P, and Enrodes can produce electricity at a constant marginal cost of $4 per megawatt-hour. Consumers in this region of Michigan have recently complained that Enrodes is charging too much for its services. In fact, a few consumers are so upset that they are trying to form a coalition to lobby the local government to regulate the price Enrodes charges. If all the consumers of this region joined the coalition against Enrodes, how much would each consumer be willing to spend to lobby the local government to regulate Enrodes’s price? Do you think the consumers will be successful in their efforts? Explain.
You are the manager of a monopoly, and your analysts have estimated your demand and cost functionsas P = 300 − 3Q and C(Q) = 2, 000 + 2Q2, respectively.(a) What price-quantity combination maximizes your firm’s profits?(b) Calculate the maximum profits.(c) Is demand elastic, inelastic, or unit elastic at the profit maximizing price-quantity combination?(d) What price-quantity combination maximizes revenue?(e) Calculate the maximum revenues.(f) Is demand elastic, inelastic, or unit elastic at the revenue maximizing price-quantity combination?