Determine the TRUE statementSelect one:○ a. None of the optionsb. A monopolist obtains higherprofits under first-degreeprice discrimination thanunder third-degree pricediscriminationc. A monopolist can neverpractice third-degree pricediscrimination○ d. A monopolist will alwaysobtain zero profitsregardless pricediscrimination

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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 manufacturer estimates that D(p)=3000e0.05p units of a particular good will be sold at market price of p cedis per unit. Determine the market price that will result in marginal revenue of zero. 2. A manufacturer estimates that q = 800/30 – p units of a commodity are demanded when cedis per unit are charged. a. Express the price elasticity of demand as function of p . b. Calculate the price elasticity of demand when p=10. Interpret the result. c. Find the price at which the price elasticity of demand is unit-elastic. 3. An auto maker estimates that when q units of its saloon cars are sold in a day, its profit in millions of cedis is modelled as P(q) =100+25In 20 Find the 2 number of cars that should be produced and sold to maximise profit.
Which of the following is a necessary condition for price discrimination? Group of answer choices a. Buyers are aware of prices charged to other buyers. b. The seller is a perfectly competitive firm. c. Buyers have identical elasticities of demand. d. Resale of the product or service is possible. e. The seller can separate consumers according to their elasticities of demand.
3. A monopolist faces demand P=60−5q, has constant marginal costs of 15, and has zero fixed costs. If this monopolist is able to practice perfect price discrimination, its maximum total profit will be a) 202.50 dollars. b) 405.00 dollars. c) 135.00 dollars. d) 151.88 dollars.
B) The table below shows the information on quantity, price and cost of a monopolist. Assume that the fixed cost is $20, Quantity Price Total Variable Cost 10 $9 $20 20 8 $60 30 $7 $120 40 S6 $200 50 $5 $300 60 $4 $420 Determine the optimal output of the firm and compute the profit or loss of the firm at the optimal output. At what price will the monopolist exit from the industry?
Question: answer the images in a short run monopolist will shut down when? a natural monoploy is most likely to occur in the market when?
A (single-price) monopolist is maximizing profits when A. the marginal revenue associated with the last unit of output is equal to its marginal cost B. the price at which they sold the last unit of output is equal to its marginal cost C. the average revenue associated with the last unit of output is equal to its marginal cost
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You are a monopolist making a durable good, the widget. Some of your customers have started to sell their used widgets to others. Assume the used and new widgets are perfect substitutes, but with 2 used equivalent to one new widget. a.) what effect would an increase in cost for new widgets have on the price of new and used widgets? b.) You consider trying to get the used widgets market made illegal. If this were done perfectly, how would it affect your monopoly's price and profits? show this graphically and in words
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QUESTION 4 Explain price discrimination. what are the conditions to make price discrimination effective? provide your answers with examples from the Airline industry.
Figure 4 MC MR 20 40 60 80 100 120 Quantity (tickets per hour) 21. In figure 4, a single price monopolist would charge what? 22. In figure 4, a price discriminating monopolist would charge what? Price and costs (dollars per ticket)
True/ False There is a price discrimination in the monopoly market.

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