11. A monopoly firm holding a patent right faces a market demand given in the table. Weassume there is no fixed costs and the monopolist maximizes profit.ΔTRΔTCa. Fill in the blanks. [Hint: MR =You may want to construct columns forAQ‚MCAQAQ, ATR, and ATC to find MR and MC.]TRMRTCMCProfit20306001624083601840320165040014604801270560b. From the table above, what is the price the monopoly firm would choose?

a) The table is represented below:

11. A monopoly firm holding a patent right faces a market demand given in the table. We assume there is no fixed costs and the monopolist maximizes profit. ΔTR ATC a. Fill in the blanks. [Hint: MR = MC AQ You may want to construct columns for AQ %3D AQ, ATR, and ATC to find MR and MC.] TR MR TC MC Profit 20 30 600 16 240 8 360 18 40 320 16 50 400 14 60 480 12 70 560 b. From the table above, what is the price the monopoly firm would choose?

11. A monopoly firm holding a patent right faces a market demand given in the table. We assume there is no fixed costs and the monopolist maximizes profit. ΔTR ATC a. Fill in the blanks. [Hint: MR = MC AQ You may want to construct columns for AQ %3D AQ, ATR, and ATC to find MR and MC.] TR MR TC MC Profit 20 30 600 16 240 8 360 18 40 320 16 50 400 14 60 480 12 70 560 b. From the table above, what is the price the monopoly firm would choose?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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1. A little town in the Midwest obtains all of its electricity from one company, Northstar Electric. Although the company is a natural monopoly, it is owned by the citizens of the town, all of whom split the profits equally at the end of each year. The CEO of the company claims that because all of the profits will be given back to the citizens, it makes economic sense to charge a monopoly price for electricity. True or False? Explain. Feel free to draw a graph to illustrate your answer.
3. When is it optimal for a monopolist to produce the same output as in a perfectly competitive market?
The figure to the right shows the demand and cost curves facing a monopoly. In order t maximize its profit, the monopolist produces less units than the competitive market level of output. OA. 25 OB. 50 OC. 15 OD. 75 A D 400- 300- 200- 100- 0 25 D 75 50 MC - AC 100 Q
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E1
1 Suppose that a monopolist has a patent for widgets and the market demand curve Q(P) is:Q(P) = 60 – 2P,where P is the price in dollars and Q is quantity. a. Solve for the inverse demand P(Q) curve by solving the demand curve for P in terms of Q. b. Using your answer from (a), express the monopolist’s total revenue in terms of Q as TR(Q) = QP(Q). c. Calculate the monopolist’s marginal revenue MR(Q) by differentiating the total revenue you found in theprevious step: MR(Q) = dTR(Q) / dQ. PLEASE SHOW ALL WORK
The graph depicts the market for cable where there is one natural monopoly; AC represents average (total) cost, D represents market demand, and MR represents marginal revenue. Assume that the marginal cost is equal to 0. Suppose that before the cable company lays any cable, the government decides to regulate the monopoly by setting the price. What is the lowest price that regulators can impose while ensuring that the cable company enters the market? 2 What will a monopolist charge in the absence of any regulation? 4 Price $10 9 8 7 6 5 4- 3- تیا 2 1 0 1 AC 2 MR نیا D 4 5 6 7 8 9 10 Households (in millions)
3 6 A10. REFER TO FIGURE 4 The price charged by the profit-maximising monopolist is: a. 14 b. 12 c. 8 d. 6 e. 3 Market Price 12 14 42 8 00 30 35 MR 50 في (၂ LRMC AR AR LRAC Quantity Demanded
*You only need to answer question f*
5 int ences $55 $50 $45 $40 $35 $30 $25 $20 $15 $10 $5 0 N MR units MC Quantity D 4 5 6 7 8 9 10 11 Tools DWL Instructions: In parts a and b, enter your answers as a whole number. In parts c-e, round your answers to two decimal places. a. What is the profit-maximizing level of output? b. What price will the monopolist charge to maximize profits? $ CS c. Determine the efficiency costs (deadweight loss) of monopoly output/pricing. Instructions: Use the tool provided 'DWL' to illustrate this area on the graph. Drag the points to move or resize. What is the efficiency cost (deadweight loss) of monopoly output/pricing? d. Determine the consumer surplus under monopoly output/pricing. Help Save & Exit Submit
2. As a monopolist, what quantity does DeBeers produce? What price do they charge? An ATC curve has been provided for DeBeers. These costs include marketing, mining exploration, and more.