Answered: Explain why a monopolistically…

Explain why a monopolistically competitive firm switches from charging a single price to Third-Degree Price discrimination (Hint: SR vs LR). Explain and graph.

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter10: Monopolistic Competition And Oligoply

Section: Chapter Questions

Problem 1SQP

See similar textbooks

Related questions

Q: prove diagrammatically that a monopolistic firm charges a higher price than a competitive firm

A: A monopolistic firm, which is the exclusive provider of a particular commodity or service, is…

Q: Suppose that a company operates in the monopolistically competitive market for electric razors. The…

A: A monopolistic competitive firm has combined elements of both monopoly and perfect competition.…

Q: In the above figure, the profit-maximizing output and price for this monopolistically competitive…

A: In a monopolistically competitive firm there are many sellers of the product, each seller produces…

Q: 100 90 80 Mon Comp Outcome 70 60 Min Unit Cost 50 ATC 30 20 10 MC MR Demand 10 20 30 40 50 60 70 80…

A: a) Because this market is a monopolistically competitive market, you can tell that it is in long-run…

Q: Suppose that a firm produces wool jackets in a monopolistically competitive market. The following…

A: The graph with the long-run monopolistically competitive equilibrium & the minimum average total…

Q: Consider a shop that produces bagels in a monopolistically competitive market. The following graph…

A: When a large number of businesses provide rival goods or services that are comparable but imperfect…

Q: Answer the next question based on the demand and cost schedules for a monopolistically competitive…

A: Profit maximizing level of output is that quantity where marginal revenue is equal to marginal cost.

Q: Because this market is a monopolistically competitive market, you can tell that it is in long-run…

A: A monopolistically competitive firm produces at the intersection of MR and MC curves. Hence, the…

Q: True O False

A: Suppose that a firm produces baseball bats in a monopolistically competitive market. The following…

Q: onopolistically competitive market. On the given graph, show Sleek's profit- aximizing output and…

A: A monopolistically competitive firm is a kind of market structure that combines elements of both…

Q: Suppose that a firm produces wooden train engines in a monopolistically competitive market. The…

A: A monopolistically competitive firm produces at the intersection of MR and MC curves. Hence, the…

Q: Suppose that a firm produces wool jackets in a monopolistically competitive market. The following…

A: Given: A firm producing wool jackets in a monopolistically competitive market

Q: Susan owns a restaurant that sells hamburgers in a monopolistically competitive market. The graph to…

A: Monopolistic competition is a market structure where many firms compete by offering differentiated…

Q: Suppose that a firm produces polo shirts in a monopolistically competitive market. The following…

A: Monopoly refers to the market with only one seller of a particular product against numerous buyers.…

Q: One day, consumer advocate Skippy Jif discovers that all brands of peanut butter in Nutville are…

A: Perfect competition is a market structure that sells an identical product, there exist many firms…

Q: Suppose that a firm produces wooden train engines in a monopolistically competitive market. The…

A: In monopolistic competitive market there are a large number of firms in the market selling…

Q: Refer to Figure 6-2. What price will the monopolistically competitive fırm charge in this market?…

A: The main features of monopolistic competition are: 1. Large number of buyers and sellers 2. Product…

Q: Suppose that a firm produces polo shirts in a monopolistically competitive market. The following…

A: In monopolistic competition, there are many sellers of differentiated products as there is free…

Q: Q) Is there any deadweight loss associated with monopolistically competitive market structure? Why…

A: Monopolistic competition refers to the market form where there are large number of buyers and…

Q: Consider a monopolistically competitive industry where firms differ in productivity levels. When the…

A: Monopolistic competition is a sort of imperfect competition in which several producers compete…

Q: Because this market is monopolistically competitive, you can tell that it is in long-run equilibrium…

A: A monopolistically competitive market is a type of market structure where there are many firms…

Q: 8 a PRICE (Dolars per engne) 88 8 RR2 10 D . 10 MR ATC Demand NO 50 QUANTITY (Thousands of engines)…

A: A monopolistic competitive firm optimal output occurs at the intersection of MR and MC (i.e., at MR…

Q: Suppose the market for toothpaste is monopolistically competitive and in long-run equilibrium. The…

A: Monopolistically competitive market is characterized by the presence of the many buyers and sellers.…

Q: The following graph represents a monopolistically competitive firm in long-run equilibrium. Place…

A: Monopolistically competitive firm offer competing products but their characteristics are different.…

Q: Suppose that a firm produces polo shirts in a monopolistically competitive market. The following…

A: Below is the complete graph:

Question

). Explain why a monopolistically competitive firm switches from charging a single price to Third-Degree Price discrimination (Hint: SR vs LR). Explain and graph.

Definition Definition Form of market structure in which there are a large number of sellers of a particular product, with each seller selling somewhat differentiated but close substitutes to the product sold by other sellers. Features of monopolistic competition include: Large number of buyers and sellers Differentiated products Free entry and exit of the firms in the market

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Follow-up Questions

Read through expert solutions to related follow-up questions below.

Follow-up Question

(Hint: SR vs LR). Explain and graph.

Solution

by Bartleby Expert

SEE SOLUTION

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

Suppose that a company operates in the monopolistically competitive market for denim jackets. 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. Nex 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 jacket) 100 90 80 70 60 50 ATC 20 40 30 20 10 10 MC MR Demand 0 + + 0 10 20 30 40 50 60 70 80 90 100 QUANTITY (Thousands of jackets) Mon Comp Outcome Min Unit Cost at the optimal the efficient scale. Because this market is monopolistically competitive, you can tell that it is in long-run equilibrium by the fact that P= ATC quantity for each firm. Further, the quantity the firm produces in long-run equilibrium is True or False: This indicates…
The following graph represents a monopolistically competitive firm in long-run equilibrium. Place the black point (cross sign) on the graph to indicate the short-run profit-maximizing price and quantity for this monopolistically competitive company. Next, place the grey star on the graph to indicate the point where the LRAC reaches a minimum. PRICE PER UNIT (Dollars) 500 450 400 350 300 250 200 150 100 50 MC 0 0 50 LRAC MR Demand 100 150 200 250 300 350 400 450 500 QUANTITY (Units) Monopolistically Competitive Outcome Minimum of the LRAC The long-run equilibrium price is $ (Hint: Use the graph to find the numeric value of the price at equilibrium.) The long-run equilibrium quantity is units. The LRAC curve is at its minimum at a quantity of The long-run equilibrium price is units. the marginal cost of producing the equilibrium output. ?
Suppose that a firm produces polo shirts in a monopolistically competitive market. The following graph shows its demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve. 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 unification the minimum average total cost the firm faces and the quantity associated with that cost. Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that ___ at the optimal quantity for each firm. Furthermore, the quantity the firm produces in long-run equilibrium ___ the efficient scale. True or False: This indicates that there is excess capacity in the market for shirts. Monopolistic competition may also be socially inefficient because there are too many or too few firms in the market. The presence of the ___…
"prove diagrammatically that a monopolistic firm charges a higher price than a competitive firm"
Monopolistic Competition -- Questions 16-20 refer to Figure 6-2 below. This figure depicts a situation in a monopolistically competitive market. Figure 6-2 105 100 - MC 95+ 90+ ATC 75 70 65 60 55 30 45 40 35 15 10 MR Demand 5 10 15 20 25 3o 35 40 45 50 ss 60 6s 70 75 80 85 90 95 100105110115120 2
Please help me with this question
Suppose that a firm produces wooden train engines in a monopolistically competitive market. The following graph shows its demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve. 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 engine) 100 90 80 70 60 50 40 30 20 10 MC 0 0 10 O True ATC Demand False MR 20 30 40 50 60 70 80 QUANTITY (Thousands of engines) 90 100 Mon Comp Outcome Min Unit Cost True or False: This indicates that there is excess capacity in the market for engines. Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that optimal quantity. Furthermore, the quantity the firm produces in long-run equilibrium…
Suppose that a firm produces wooden train engines in a monopolistically competitive market. The following graph shows its demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve. 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 engine) 100 90 80 70 60 50 40 30 20 10 0 0 II MC + 10 Ⓒ True O False MR ATC I Demand I 20 30 40 50 60 70 QUANTITY (Thousands of engines) 80 90 100 Mon Comp Outcome Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that P = ATC at the optimal quantity for each firm. Furthermore, the quantity the firm produces in long-run equilibrium is less than the efficient scale. Min Unit Cost True or…
What is the difference between purely competitive market (PCM) and monopolistically competitive market (MCM)? Please explain conceptually.
Suppose that a firm produces baseball bats in a monopolistically competitive market. The following graph shows its demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve. 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. 100 90 80 Mon Comp Outcome 70 Min Unit Cost 50 ATC 40 30 20 10 MC MR Demand 10 20 30 40 50 60 70 80 90 100 QUANTITY (Thousands of bats) Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that ▼ at the optimal quantity for each firm. Furthermore, the quantity the firm produces in long-run equilibrium is the efficient scale. PRICE (Dollars per bat)
Suppose that a company operates in the monopolistically competitive market for denim jackets. 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. ? 100 PRICE (Dollars per jacket) 8 20 60 50 X ATC 20 MC MR 2 2 2 2 10 0 0 30 40 50 60 70 QUANTITY (Thousands of jackets) 10 20 80 Demand 90 100 Mon Comp Outcome Min Unit Cost
Suppose that a company operates in the monopolistically competitive market for denim jackets. 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 jacket) 100 90 80 70 60 40 30 20 MC 10 ATC MR Demand 0 0 10 20 30 40 50 60 70 80 90 100 QUANTITY (Thousands of jackets) + Mon Comp Outcome Min Unit Cost Because this market is monopolistically competitive, you can tell that it is in long-run equilibrium by the fact that. firm. Further, a monopolistically competitive firm's average total cost in long-run equilibrium is at the optimal quantity for each the minimum average total cost.