Q7. Why is a monopoly allocatively inefficient? a.) Because price is greater than marginal cost at the profit-maximizing level of output. b.) Because price is less than marginal cost. c.) Because price is equal to marginal cost.
Q: define the cross-price elasticity of demand? 2.d) Compare and contrast monopoly and perfect…
A: The cross-price demand elasticity(XED) measures the sensitivity of the demand of the quantity(Qd)…
Q: (i) If the demand is elastic with respect to own price, what would happen to a monopoly's total…
A: We know the relationship between revenue and elasticity: dRdp=q1-E
Q: Question 10.10 The non-discriminating pure monopolist must decrease price on all units of a product…
A: Monopoly is a market form which indulges in discriminating generally because of the motive of profit…
Q: True or False: (D). A monopoly earns total revenue of $5000 when it sells 500 units of output and…
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Q: 32. Which of the following distinguishes a natural monopoly from all other market structures,…
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Q: 2.1 Graphically illustrate and explain the monopolist’s output decision. 2.2 The ultimate…
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Q: Price =120-Q^2 Total cost = 30Q Find: 1- consumer surplus 2- profit 3- total social welfare 4-…
A: In perfect competition, there are large number of buyers and sellers, and a homogenous good is being…
Q: 44. Which of the following statements about a monopoly is FALSE? a. A monopoly has many suppliers of…
A: Monopoly market has some characteristics as, • monopoly has single suppliers of the good.…
Q: es efficient output.
A: Answer Reason - first-degree value discrimination (perfect value discrimination) can forever have.…
Q: Question 14 Consider a monopoly using a two part tariff against consumers with downward sloping…
A: Consumers are homogenous when their demand for specific good is similar, while heterogenous…
Q: 9. One firm previously operated as a monopoly. Now, one potential entrant exists. Consumers would…
A: A monopoly is a market structure where there are only one seller and many buyers. The seller has…
Q: 5. The allocatively efficient quantity of product Z for the whole market is 2 million units. At that…
A: "Since you have asked multiple questions, we will solve first question for you .. If you want any…
Q: 9-6 Explain why a firm with market power might decide to charge different groups different prices
A: 9-6 Price discrimination refers to a situation when a seller charges different prices to different…
Q: Using a real life example, explain that is meant by a ‘natural monopoly’. What are at least 3…
A: A natural monopoly is a monopoly in which the largest supplier in an industry, generally the first…
Q: (III. 1) Are the following statements about monopoly true? (Choose “True" or “False") (a) If a…
A: Since you have asked multiple question, we will solve the first question for you. If you want any…
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Q: A nightclub manager realizes that demand for drinks is more elastic among students, and is trying to…
A: Average demands: Under 25: qr = 18 − 5p Over 25: q = 10 − 2p Marginal costs = $2
Q: No firm is completely sheltered from rivals; all firms compete for consumer dollars. If that is so,…
A: A pure monopoly occurs when the market for a commodity is dominated by a single firm, such as the…
Q: Consider a monopoly operating in two markets, TC(q) = 10q, q1=50 - p1, q2=30 - p2 3.1 Determine…
A: Given information TC=10q q1=50-p1 q2=30-p2 Firm is monopoly selling into 2 markets with
Q: Do you think that a monopolist firm and a competitive firm have the same market power? Explain you…
A: Monopolistic competition refers to the situation where there are many firms exists in the market.…
Q: Question 10.10. The nondiscriminating pure monopolist must decrease price on all units of a…
A: A solitary price, non-discriminating monopoly is one in which a similar price is charged to along…
Q: 3.- (From problem 5.3 in the textbook) A nightclub manager realizes that demand for drinks is more…
A: Hello. Since your question has multiple sub-parts, we will solve first three sub-parts for you. If…
Q: Are the following statements true or false? (D). A monopoly earns total revenue of $5000 when it…
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Q: A monopoly seller faces a demand curve ?(?) = 120 − 4p. The cost is ?(?) = 2 +Q^2 (a) Write down…
A: The above question gives us the production function and the cost function of a monopolist. Using…
Q: Draw the demand curve, marginal revenue, and marginal cost curves from Figure 9.6, and identify the…
A: Monopoly is a form of market structure in which a single firm sells a commodity for which there are…
Q: Price =120-Q^2 Total cost = 30Q Find: 1- consumer surplus 2- profit 3- total social welfare 4-…
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A: When a firm follows Average cost pricing, price is set equal to average cost. The firm is said to…
Q: Problem 11-05 (algo) You are the manager of a monopoly. Your analytics department estimates that a…
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Q: 8 A monopoly has the following demand and Total Cost curve: Demand: P=1000-10Q TC=100Q+5Q2 1. How…
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Q: Which of the following is true at the profit-maximizing output for both a perfectly competitive firm…
A: A perfectly competitive firm's profit maximizing output is determined where P=MR=MC Because for a…
Q: “No firm is completely sheltered from rivals; all firms compete for consumer dollars. If that is so,…
A: A pure monopoly is an economic business system where the only vendor in the market is a single…
Q: Question 3 The demand curve facing a monopoly firm is: O A. equivalent to the market demand curve.…
A: Demand curve- It is the graph that shows how the demand for a good or service is altered because of…
Q: You are the manager of a monopoly, and your analysts have estimated your demand and cost functions…
A: In monopoly, eqm quantity is found by the intersection of MR(marginal revenue) and MC(marginal cost)…
Q: (Perfect Price Discrimination) Why is the perfectly dis- criminating monopolist’s marginal revenue…
A: Definition: The First-degree Price Discrimination or Perfect price discrimination charges different…
Q: Next, suppose that the industry is monopolized. Market demand (D) for the product is: P = 60- 2Q The…
A: Introduction We have given market demand and cost of a monopolist. Market demand has given as P = 60…
Q: The diagram below shows the demand curve and marginal cost and marginal revenue curves for a new…
A: A perfectly price discriminating firm is one that charges different prices from the people according…
Q: 9. If a firm is able to set price, A) it is a monopoly. B) its marginal revenue is constant. C) it…
A: Monopoly occurs in a market when a single business unit has the privilege to serve the entire…
Q: a) With the aid of a diagram, explain how an ordinary monopoly that sells its output at a uniform…
A: A monopoly consists of one firm that produces a one of a kind product or service that has no near…
Q: Consider a market with a monopoly firm. Sales revenue of this firm is $10,340,000$10,340,000, total…
A: Monopoly is a market situation where there are large numbers of buyers and single seller. The seller…
Q: output and price, and discuss its implications, if: You are a monopolistically competitive firm…
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- Suppose the market for Hula Hoops is monopolized by a single firm. a. Draw the initial equilibrium for such a market. b. Now suppose the demand for Hula Hoops shifts outward slightly. Show that, in general (contrary to the competitive case), it will not be possible to predict the effect of this shift in demand on the market price of Hula Hoops. c. Consider three possible ways in which the price elasticity of demand might change as the demand curve shifts: It might increase, it might decrease, or it might stay the same. Consider also that marginal costs for the monopolist might be increasing, decreasing, or constant in the range where MR=MC Consequently, there are nine different combinations of types of demand shifts and marginal cost slope configurations. Analyze each of these to determine for which it is possible to make a definite prediction about the effect of the shift in demand on the price of Hula Hoops.Do you agree or disagree with each of the following statements? Explain your reasoning. a. For a monopoly, price is equal to marginal revenue because a monopoly has the power to control price. b. Because a monopoly is the only firm in an industry, it can charge virtually any price for its product. c. It is always true that when demand elasticity is equal to –1, marginal revenue is equal to 0.“No firm is completely sheltered from rivals; all firms compete for consumer dollars. If that is so, then pure monopoly does not exist.” Do you agree? Explain. How might you use Chapter 6’s concept of cross elasticity of demand to judge whether monopoly exists?
- Suppose the local electrical utility, a legal monopoly based on economies of scale, was split into four firms of equal size, with the idea that eliminating the monopoly would promote competitive pricing of electricity. What do you anticipate would happen to prices? and why?Q1. Consider the following graph for a pure monopoly firm selling electricity. (a)What are the profit maximization output and price? How much is the profit? (b)Suppose the demand for electricity increases due to the unusually cold weather. Would the profit maximizing output increase or decrease? What about the price?Which of the following situations would likely result in the formation of a natural monopoly? Question 21Select one or more: a. There is very low demand for the product, i.e., there’s a small market b. Firms have large fixed costs and a constant marginal cost of production c. Due to return to scale, one large firm can produce at a lower cost than many small firms d. The government issues liquor licenses, which are required for businesses to sell alcohol e. Doctors can only practice medicine if they are accredited by the American Medical Association f. The government issues a patent for a new invention
- 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.Answer the given question with a proper explanation and step-by-step solution. 3. Use monopoly firm A's graph below to answer questions a-g. a) To maximize profit firm A should produce approximately ______X b) Briefly explain your response to part a: _____ c) What is the maximum price firm A can charge if it produces 6 units of X? $________ d) Firm A's total revenue at 5 units of X is $_________ e) Firm A's total cost at 6 units of X is $________ f) Firm A's total profit at 6 units of X $____________ g) Is firm A's profit positive, zero, or negative? h) Briefly explain your answer to part g:1) In the case of a perfectly price-discriminating monopoly, there is: A. zero consumer surplus. B. as much consumer surplus as in the case of perfect competition. C. as much consumer surplus as in the case of a standard monopoly. 2) On Black Fridays, most retail outlets have major storewide sales. Yet, as one of the busiest shopping days in the United States, one would expect prices to increase, not decrease. Price discrimination explains the answer to this question because price: A. sensitive shoppers are more likely to notice tying and bundling tricks. B. insensitive shoppers will stay away to avoid the crowds. C. sensitive shoppers are more likely to want to stay away from Black Friday.
- Diminishing marginal returns implies:. Single choice. a.Decreasing average variable costs b.Decreasing marginal costs c.Increasing marginal costs d.Decreasing average fixed costs In pure monopoly, what is the relation between the price and the marginal revenue?. Single choice. a.the price is greater than the marginal revenue b.the price is less than the marginal revenue c.there is no relation d.they are equal In the figure, if the total cost of producing 99 units of output per day is $475, the marginal cost of producing the 100th unit of output per day is approximately. Single choice. a.zero. b. $25. c. $475. d. $500. The burden (incidence) of a tax will fall mainly on the producers if:. Single choice. a.The producers are the ones legally obliged to pay the tax. b.Supply is inelastic and demand is elastic. c.Demand is inelastic and supply is elastic. d.There are many producers in the market. The need for the…Describe the concept of price elasticity! Why it is for a monopoly less profitable to act inmarkets with high price elasticity? What can a monopolist or a firm with market power do, inorder to increase the profits?Question 27 Consider a monopoly market in which the market demand curve is given by P = 240 – 2Q, the marginal revenue curve is MR = 240 – 4Q, the marginal cost curve is MC = 2Q, and there are zero fixed costs. Suppose the government intervenes and turns the market into a competitive market, and all the firms in the market have the same marginal cost curve as the monopolist, MC = 2Q, and zero fixed costs. How much is the resulting gain in total surplus? 300 800 400 600
