EBK ECONOMICS
13th Edition
ISBN: 8220106799642
Author: PARKIN
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 15, Problem 3SPA
(a)
To determine
Identify whether the broadband and broadcast television markets are
(b)
To determine
Identify barriers which limit the competition and allow to influence the price.
(c)
To determine
Identify the changes in the broadband and broadcast television market in terms of new law.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Topic: Market Power
Write a one to two-page paper, addressing the following:
a. Describe in your own words the concept of market power.
b. What are the three reasons that a market might have a Monopoly?
c. Give an examples of two monopoly Firm exercising its market power.
"I'm About to Lose You"
The wireless industry ranks among the bottom five businesses in the American Customer Satisfaction Index. Critics say that the wireless industry has become a cozy
cartel of a few dominant providers. They point to several unfair practices: high termination fees; costly to switch providers; handsets that only work with a single carrier;
and limited access to Web sites. Now Washington is listening.
Source: Newsweek, August 6, 2007
If it were costless to switch providers, explain what changes would occur in the wireless market. Would there be a role for Washington?
If it were costless to switch providers,
O A. more providers would enter the industry and the price would fall. The fall in price would decrease demand for smartphones. Washington would not need to
interfere
O B. providers would be even more diligent at maintaining the same high price, and Washington would be forced to police the industry to ensure that antitrust laws
are not broken
O C. consumers would…
Question 10 of 20
The accompanying graph depicts a hypothetical monopoly. Follow instuctions 1-3 below to identify the monopoly's profits.
1. Place point E at the monopoly's profit maximizing price and quantity.
2. Move the average total cost (ATC) curve to a position that depicts the monopoly earning a positive profit.
3. Place the area labeled Profit in the area of the graph that represents the monopoly's profit.
10
E
MC
Profit
9
8
АТС
7
5
4
3
2
1
MR
D
1
2
4
7
8
9.
10
Quantity (millions of units)
Price ($ per unit)
Chapter 15 Solutions
EBK ECONOMICS
Ch. 15.1 - Prob. 1RQCh. 15.1 - Prob. 2RQCh. 15.1 - Prob. 3RQCh. 15.1 - Prob. 4RQCh. 15.2 - Prob. 1RQCh. 15.2 - Prob. 2RQCh. 15.2 - Prob. 3RQCh. 15.2 - Prob. 4RQCh. 15.2 - Prob. 5RQCh. 15.2 - Prob. 6RQ
Ch. 15.3 - Prob. 1RQCh. 15.3 - Prob. 2RQCh. 15.4 - Prob. 1RQCh. 15.4 - Prob. 2RQCh. 15.4 - Prob. 3RQCh. 15.4 - Prob. 4RQCh. 15.4 - Prob. 5RQCh. 15 - Prob. 1SPACh. 15 - Prob. 2SPACh. 15 - Prob. 3SPACh. 15 - Prob. 4SPACh. 15 - Prob. 5SPACh. 15 - Prob. 6SPACh. 15 - Prob. 7SPACh. 15 - Prob. 8SPACh. 15 - Prob. 9APACh. 15 - Prob. 10APACh. 15 - Prob. 11APACh. 15 - Prob. 12APACh. 15 - Prob. 13APACh. 15 - Prob. 14APACh. 15 - Prob. 15APACh. 15 - Prob. 16APACh. 15 - Prob. 17APACh. 15 - Prob. 18APACh. 15 - Prob. 19APACh. 15 - Prob. 20APACh. 15 - Prob. 21APACh. 15 - Prob. 22APACh. 15 - Prob. 23APA
Knowledge Booster
Similar questions
- nd ID! But it is also so you can get some pr The diagram shows the market for Film circa 1925, when Kodak ruled the industry. Price of roll 50 40 30 20 10 0 MR D 1. What is the monopoly price of a roll of film? 2. What is the monopoly quantity of film sold? 3. What is the competitive price of a film roll? 4. What is the competitive quantity of film sold? 500 600 700 800 S 006 Quantity per day (thousands), rolls 1,000arrow_forwardMacmillan Learning (Figure: Pay Per View Movies on Xfinity Cable) Use Figure: Pay Per View Movies on Xfinity Cable. The figure shows the demand and marginal revenue curves for on-demand movie rentals on Xfinity. Assume that marginal cost and average cost are constant at $20. If the cable company has market power, what price will it charge? Price, Costs, Marginal Revenue $100 90 80 70 60 50 40 30 20 10 1 2 3 MR 4 5 6 7 8 9 DO Darrow_forward5. The graph attached represents a monopoly firm. Answer the questions below. a. Briefly explain three ways in which pricing can be set with a regulated monopoly and the intended objective of each pricing method.b. Based on the diagram, if this monopoly firm is unregulated, what will be its profit? Show your calculations.c. Based on the diagram, if this firm is regulated based on social interest theory, what will be its profit? Show and explain your calculations.d. Based on the diagram, if this monopoly is subject to rate of return regulation, what will be the new price, output and profit of the firm? Show your calculations with explanations.e. Based on the diagram, if this is a natural monopoly that is allowed to set its price, what will be the minimum it should set in order to make a profit or break even? Explain your answer.arrow_forward
- 6) There is a game afoot with the competition as to whether to collude on a price change or not. The game results look like: Firm B Price Price Dec Inc Firm A Price Dec A:75, B:75 200,20 Price Inc 20,200 50,50 Briefly explain the choice of Firm A, and the choice of Firm B. Why did you make the choices you made and not other available choices?arrow_forwardIlia is driving home from work. She needs to buy gas and notices an Exxon-Mobil station on one side of the street and a Shell station on the other side of the street. Although run by different companies, the two stations sell gasoline at the same price. a. The most likely reason that the price is the same is that _gas stations always make a profit, so they can charge any price they want. _drivers need gas and are willing to pay whatever price a gas station charges. _government regulation requires both gas stations to charge the same price. _consumers view gasoline from different gas stations as perfect substitutes. b. If one station increases its price, _it will be fined by the government. _it will sell more gasoline. _it will make a higher profit. _it will lose customers to the cheaper station across the street.arrow_forward1. Do you believe that Netflix will become or is already a monopoly? What are some of the monopoly traits that would make you believe it will soon be or is already a monopoly? 2. In a competitive business environment, firms are said to be break-even in the long run. What does this exactly mean, why does it happen? Does this long-run break-even outcome apply to all market structures, and why?arrow_forward
- S 2 Fiona has a monopoly on motorboat rentals on Nantucket Island during the summer. She can rent five boats per week at $21,000 each. If she wants to rent six, she can only charge $20,000 each. a. The price effect of renting the sixth motorboat is: $_____ b. The quantity effect of renting the sixth motorboat is: $_____ c. The marginal revenue of renting the sixth motorboat is: $_____arrow_forwardWhat is the best definition of a natural monopoly? a. Natural monopoly refers to any monopoly that is sanctioned by the government. b. Natural monopoly refers to a cost structure that has large fixed costs and a small constant marginal cost of production. C. Natural monopoly refers to any monopoly that can sustain its market power. d. Natural monopoly refers to a monopoly that drove all of its competitors out of business. e. Natural monopoly refers to any monopoly that likely can't sustain its market power for very long because the source of its power is susceptible to erosion (e.g., an expiring patent).arrow_forwardPlease read the following article from The Atlantic on the proliferation of price discrimination for online shopping https://goo.gl/EGFynW A.) The article notes that we are moving toward a situation in which perfect price discrimination is no longer “only a classroom thought experiment.” Suppose perfect price discrimination were to become a reality. What would this imply as far as consumer surplus, producer surplus, and market surplus in the market for online retail? B.) The article references a study showing that by using big data online firms are able to boost profits. When firms engage in price discrimination and experience an increase in profits, does this imply that consumers are made worse off as a result? Explain. C.) Do you agree with the author’s belief that the proliferation of price discrimination “makes suckers of us all”? Explain. D.) Do you consider the increased price discrimination in recent years as a net positive or a net negative to society? Explainarrow_forward
- The following graph shows the daily demand curve for bippitybops in Detroit. Use the green rectangle (triangle symbols) to compute total revenue at various prices along the demand curve. Note: You will not be graded on any changes made to this graph. PRICE (Dollars per bippitybop) OTAL REVENUE (Dollars) 2400 1600 100 90 1200 80 1000 70 800 60 50 40 30 20 2200 + 10 2000 + 1800 + 0 1400 + Calculate the daily total revenue when the market price is $90, $80, $70, $60, $50, $40, $30, and $20 per bippitybop. Then, use the green point (triangle symbol) to plot the daily total revenue against quantity corresponding to these market prices on the following graph. (?) 0 ** B Demand 80 10 20 30 40 50 60 70 QUANTITY (Bippitybops per day) 90 100 Total Revenue A ? Total Revenuearrow_forwardUse the following table to answer the following three questions. Demand: Quantity 1 2 3 4 5 6 7 8 9 10 Price 10 9 8 7 6 5 4 3 2 1 Marginal Revenue 10 8 6 4 2 0 -2 -4 -6 -8 Costs: Marginal Cost 9 6 5 3 2 3 4 5 7 10 Average Cost 9 7.5 6.7 5.8 5 4.7 4.6 4.6 4.9 5.4 If the transit system was allowed to operate as an unregulated monopoly, what output would it supply and what price would it change? If the transit system was regulated to operate with no subsidy ( i.e., at zero economic profit ), what approximate output would it supply and what approximate price would it charge? If the transit system was regulated to provide the most allocatively efficient quantity of output. what output would it supply and what price would it…arrow_forward2 A monopoly sells its goods in the United States, where the elasticity of demand is -2, and in Japan, where the elasticity of demand is -5. Its marginal cost is $10. At what price does the monopoly sell its goods in each country if resale is impossible?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Principles of Economics 2eEconomicsISBN:9781947172364Author:Steven A. Greenlaw; David ShapiroPublisher:OpenStax
Principles of Economics 2e
Economics
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:OpenStax