Question 6 of 20<>A monopolist makes self-cleaning jackets. At a price of $100 each, it can sell 20 jackets. At a price of $98 each, it can sell 21jackets. Assume the monopolist cannot price discriminate.When charging $100 per jacket, total revenue isWhen charging $98 per jacket, total revenue isSo the marginal revenue of selling the 21st jacket is$What is true about any firm facing a downward-sloping demand curve?Marginal revenue is always%24%24%24 What is true about any firm facing a downward-sloping demand curve?Marginal revenue is alwaysequal to price.less than price.more than price.

A monopolist can sell 20 jackets at a price of $100 each. Total revenue = Price * Quantity =>Total revenue = $100 * 20 => Total revenue = $2000 Answer: When charging $100 per jacket, total revenue is $2000A monopolist can sell 21 jackets at a price of $98 each. Total revenue = Price * Quantity =>Total revenue = $98 * 21 => Total revenue = $2058 Answer: When charging $98 per jacket, the total revenue is $2058Total revenue from selling 20 jackets is $2000 Total revenue from selling 21 jackets is $2058 => Marginal revenue = (change in total revenue / change in output) => Marginal revenue = ($2058 - $2000) / (21 -20) => Marginal revenue = $58 / 1 => Marginal revenue = $58 Answer: The marginal revenue from selling the 21st jackets is $58 The demand curve shows the price at each level of quantity. The demand curve is downward sloping, the associated marginal revenue curve is always below the demand curve. Hence, the marginal revenue is always less than the price. Answer: Less than price

Business

Economics

A monopolist makes self-cleaning jackets. At a price of $100 each, it can sell 20 jackets. At a price of $98 each, it can sell 21 ackets. Assume the monopolist cannot price discriminate. When charging $100 per jacket, total revenue is $ When charging $98 per jacket, total revenue is $

A monopolist makes self-cleaning jackets. At a price of $100 each, it can sell 20 jackets. At a price of $98 each, it can sell 21 ackets. Assume the monopolist cannot price discriminate. When charging $100 per jacket, total revenue is $ When charging $98 per jacket, total revenue is $

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Answer multiple choice
Item 7 Suppose a monopolist’s profit-maximizing output is 400 units per week and that the firm sells its output at a price of $40 per unit. The firm has total costs of $8,000 per week. Assume the monopolist is maximizing its profit and earns $20 per unit from the sale of the last unit produced each week.
Single Price Monopolists produce where P=MC True False
Suppose a monopolist sells a product to faculty members and students on the campus. If the firm sets a single price, the monopolist produces 5000 units and sell them at the price of $3 per unit. At this price, the price elasticity of demand for faculty member is -2.5. And the price elasticity of demand for students is -1.5. The monopolist is considering whether she should set different prices for the faculty members and students and asks for your advice. The monopolist is thinking about charging faculty members a 10% higher price. The quantity demanded by the faculty members would fall by %. The monopolist is thinking about charging students a 10% higher price. The quantity demanded by the students would fall by %. Who should the monopolist charge more? mention faculty and students and how much
A firm facing a downward sloping demand curve is producing a level of output at which price is $16, marginal revenue is $12, and average total cost, which is at its minimum value, is $8. In order to maximize profit, the firm should decrease price. A monopolist is producing a level of output at which price is $138, marginal revenue is $72, average total cost is $72, and marginal cost is $103. In order to maximize profit, the firm should output. A firm with market power is producing a level of output at which price is $19, marginal revenue is $12, average variable cost is $14, and marginal cost is $26. In order to maximize profit, the firm should price.
Suppose you are a monopolist and you have two customers, A and B. Each will buy either zero or one unit of the good you produce. A is willing to pay up to $35 for your product; B is willing to pay up to $10. You produce this good at a constant average and marginal cost of $8. If you could not engage in third-degree price discrimination, what price would you charge? OA $10. OB. $15. OC. $35. OD. $45. If you could practice third-degree price discrimination, you will earn a profit of $ (For simplicity, assume that if a consumer is indifferent between buying and not buying, he will buy.) Click to select your answer(s)
If a monopolist can practice perfect price discrimination: D O profits will increase. producer surplus decreases. consumer surplus increases.
If a monopolist could sell 7 units of output for $41 each or 8 units of output for $39 each, what is the marginal revenue of the 8th unit of output?