Managerial Economics & Business Strategy (Mcgraw-hill Series Economics)
9th Edition
ISBN: 9781259290619
Author: Michael Baye, Jeff Prince
Publisher: McGraw-Hill Education
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Question
Chapter 11, Problem 2CACQ
(A)
To determine
The firm's optimal
(B)
To determine
The firm's optimal price, quantity and profit under first degree
(C)
To determine
Optimal price , output and profit in case of two part pricing is to be ascertained.
(D)
To determine
Firm's optimal price, output and profit in case of block pricing is to be calculated.
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Students have asked these similar questions
Based on the following graph (which summarizes the demand, marginal revenue, and relevant costs for your product), determine your firm’s optimal price, output, and the resulting profits for each of the following scenarios: a. You charge the same unit price to all consumers. b. You engage in first-degree price discrimination. c. You engage in two-part pricing. d. You engage in block pricing.
You are the manager of a monopolistically competitive firm, and your demand and cost functions are estimated as Q = 36 − 4P and C(Q) = 4 + 4Q + Q2.
a. Find the inverse demand function for your firm’s product. P =____ −_____ Q
b. Determine the profit-maximizing price and level of production.
Instruction: Price should be rounded to the nearest penny (two decimal places).
Price: $_____
Quantity:_____
c. Calculate your firm’s maximum profits.
Instruction: Your response should appear to the nearest penny (two decimal places). $______
d. What long-run adjustments should you expect? Explain. multiple choice
A. Entry will occur until profits are zero.
B. Neither entry nor exit will occur.
C. Exit will occur until profits rise sufficiently high.
You are the manager of a monopolistically competitive firm, and your demand and cost functions are given by Q= 36 - 4P and C(Q)=4+4Q+Q^2.
What long-run adjustments should you expect? Explain.
What is the value of the consumer surplus (under monopoly)?
Calculate the deadweight loss (under monopoly).
What is the value of the Lerner Index? Explain what this number means.
Chapter 11 Solutions
Managerial Economics & Business Strategy (Mcgraw-hill Series Economics)
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