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- QUESTION 12 The figure is drawn for a monopolistically competitive firm PRICE 140 123.33 90 Table b 56.67 100 133.33 QUESTION 14 QUANTITY MC MR ATC Demand Refer to Figure. If this firm's decides to produce and sell at the profit maximizing level then what will be their O a. $8,887.78. O b.$5,000.00. OC-$5,000.00. O d. 50. QUESTION 13 A perfectly competitive firm produces where O a marginal cost equals price, while a monopolist produces where marginal cost exceeds price Ob price exceeds marginal cost, while a monopolist produces where marginal cost equals price Oc marginal cost equals price, while a monopolist produces where price exceeds marginal cost O d.marginal cost exceeds price, while a monopolist produces where marginal cost equals price.Exhibit 10.5 Price 3.25 3.00 2.50 0 700 1,000 MC MR ATC D = AR Quantity Exhibit 10.5 shows the demand, marginal revenue, and cost curves for a monopolistically competitive firm. At the profit-maximizing (or loss-minimizing) output and price, the firm would O a. have to expand to stay in business in the long run. O b. be better off shutting down, since total revenue does not cover fixed costs. O c. be experiencing an economic loss. O d. be earning an economic profit. O e. be earning zero economic profit.b. Suppose a price-discriminating monopoly has segregated its market into two submarkets and can prevent resale between the two. Assume that its marginal cost is constant and equal to its average total cost of $8. The firm's demand schedule for the first group is given by the first two columns of the following table. Output Price MR TR AR 24 1 22 20 3 18 4 16 5 14 12 7 10 8 8
- Consider the diagram below depicting the revenue and cost conditions faced by a monopolistically competitive firm, and then answer the following questions. MC D ATC F ..... E Demand G MR Quantity Suppose the firm produces at the break-even price. a. The resulting price-quantity combination would be illustrated by point (Click to select) ▼ b. At this point, the firm experiences O a short-run loss. O a normal profit. O an economic profit. Price and costsSuppose that a company operates in the monopolistically competitive market for electric razors. The following graph shows the demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve for the firm. Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next, place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. PRICE (Dollars per razor) 100 90 8 70 60 50 40 30 20 10 0 D MO 10 ATC MR 20 30 40 50 60 70 QUANTITY (Thousands of razors) 60 Demand 90 100 Mon Comp Outcome Min Unit CostQUESTION 1 Press F11 to exit full screen Which firm would earn profit in the long-run? O a monopolist firm. O a monopolistically competitive firm. O an oligopoly firm. O a perfectly competitive firm. QUESTION 2 Refer to the graph below for a monopolistically competitive firm. ↑Price MC 160 140 ATC 123.33 Demand 90 56.67 MR 100 133.33 154.92 Quantity If the above firm chose to produce at 100 units then the firm will be O earning a profit O incurring a loss O there is no profit and no loss O the firm can earn, profit, loss or break even
- 3 Of 16 a. A monopolistic competitor, much like a firm in perfect b. Advertising can play a role as an indirect signal of competition, sells its product at a point product quality to customers. where the price is equal to the marginal cost. true false true O false c. Monopolistically competitive industries are more likely d. In the long run, monopolistic competitors make a to make use of advertising to create products that catch similar amount of profit to monopolists, since, in both on in mainstream popularity than industries in perfect cases, the firm's demand curves are downward sloping, competition. and at the profit maximizing point, the marginal cost is true false equal to the marginal revenue. O true O false e. In the short term, a monopolistic competitor will make a profit if the demand curve is above the average total cost curve at some point. true falseThe firm in the figure below is in monopolistic competition. It will set a price equal to MC ATC MR D 0 10 20 30 40 50 60 Quantity (units per day) O a. $1. O b. $3. O c. more than $3. O d. $2. Price and costs (dollars per unit)1 Assume that in short-run equilibrium, a particular monopolistically competitive firm charges $12 for each unit of its output and sells 62 units of output per day. The average total cost (ATC) for those 62 units is $18. Instruction: Round your answers below to the nearest whole number. How much revenue will it take in each day? $ ook What will be its economic profit or loss? FInt Loss v of $ rences Next, suppose that entry or exit occurs in this monopolistically competitive industry and establishes a long-run equilibrium. If the firm's daily output remains at 62 units, what price will it be able to charge? $ What will be its economic profit or loss? Neither profit nor loss v of $ rev 1 of 9 Next > MacBook Air
- Given your understanding of the various market structures, use the information contained in the diagram below to answer the following questions. Price and cost per unit a Pa No co P₂ P₁ 0 0₁ o o, o What is the monopolistic competitor's profit-maximizing price? a) P3 Ob) P2 O c) Pl d) PA Q₂ MC MR Domand ATC QuantityRefer to Figure 17-5. Efficient scale is reached O a. at 100 units. O b. beyond 133.33 units. O c. at 133.33 units. O d. between 100 and 133.33 units. 13 Figure 17-5 The figure is drawn for a monopolistically competitive firm. PRICE MC 140 123.33 ATC Demand 90 56.67 100 133.33 QUANTITY MRIn monopolistic competition equilibrium with symmetric fırms, firms enter until each firm earns O zero economic profits because price equals average cot. O positive monopoly profits because it sells a differentiated product. O positive economic profits only if it engages in international trade O negative economic profits because of fixed costs.