EconomicsFor Limit Pricing: Demand Function P = 200 -Q Monopolist Cost Structure MC = AC = 40.Potential Entrant's Cost Structure MC = AC =60.Calculate the Monopolist Profits not limitpricing and Monopolist Profits if it limit prices.

Not Limit Pricing Given Demand Function : P = 200 - Q Potential Entrants Cost Structure Marginal…

For Limit Pricing: Demand Function P = 200 - Q Monopolist Cost Structure MC = AC = 40. Potential Entrant's Cost Structure MC = AC = 60. %3| %3D Calculate the Monopolist Profits not limit pricing and Monopolist Profits if it limit prices.

For Limit Pricing: Demand Function P = 200 - Q Monopolist Cost Structure MC = AC = 40. Potential Entrant's Cost Structure MC = AC = 60. %3| %3D Calculate the Monopolist Profits not limit pricing and Monopolist Profits if it limit prices.

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter9: Monopoly

Section: Chapter Questions

Problem 3.4P

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Give typing answer with explanation and conclusion A monopolist has a demand curve given by P = 88 − Q and a total cost curve given by TC = 34 + Q2. The associated marginal cost curve is MC = 2Q. Suppose the monopolist also has access to a foreign market in which he can sell whatever quantity he chooses at a constant price of 60. How much will he sell in the foreign market? What will his new quantity and price be in the original market?
Explain the long-run profit maximising position of a monopolist. Substantiate your answer bychoosing and applying the ONE correct diagram below:
1
3. Consider a monopolist who faces the following demand: Demand: P= 100 – 10Q MC= 50+20 a) Find the price quantity combination that maximizes profit for the monopolist. b) Is the firm making positive, negative or zero profits? (100,100) Kareem chooses (60, 105) (500, 400) Saleem chooses Kareem chooses (50,420) 4. Calculate the SPNE/SPNES for the game stated above.
28 $55 $50 $45 MC АТС I of $40 $35 $30 $25 $20 Demand = P $15 $10 $5 $0 MR 40 80 120 160 200 240 Output (Q) The diagram above shows the Demand, MR, and cost curves for a monopolist in the short-run. At the profit maximizing Output (Q) level, the monopolist will earn a Total Profit of: Sel one: а. $1,200 b. $2,200 c. $800 d. $2,000 $$
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Suppose a pure monopolist is faced with the demand schedule shown below and the same cost data as the competitive producer discussed in question 4 at the end of Chapter 9. Calculate the missing total-revenue and marginal revenue amounts, and determine the profifit-maximizing price and profit-earning output for this monopolist. What is the monopolist’s profit? Verify your answer graphically and by comparing total revenue and total cost.
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Describe the concept of price elasticity! Why it is for a monopoly less profitable to act inmarkets with high price elasticity? What can a monopolist or a firm with market power do, inorder to increase the profits?
Please no written by hand solutions 1. Assume the cost function for a monopolist is given by TC(q) = 30Q; the inverse demand function for the firms' output is p = 120 - Q, where Q is the total output. a. Find the profit-maximizing combination of price and quantity b. Estimate consumer surplus, producer surplus and the deadweight loss associated with this monopolist C. If this industry became perfectly competitive, explain and estimate the consumer surplus, producer surplus and deadweight loss of the industry d. Graph your answers for a, b, and c 2. Now assume that the monopolist above splits into two. Each of two firms has the cost function TC(q) = 30q. a. What are the firms' outputs in a Nash equilibrium of Cournot's model? b. Estimate the economic profits for each firm c. If firm 1 is the leader and firm 2 the follower, find the equilibrium outputs for the Stackelberg solution.
Bonus: A monopolist sells output at zero cost to two types of consumers, H and L, whoseinverse demand curves are given by Ph=45-5q and pl=30-5q. Derive and discuss the optimalsecond-degree price discriminating equilibrium. And calculate the consumer surplus for high demanded package only! Note that the monopolist cannot identify individual types, but he knows that there are two types exist.
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