Given the following demand functions of a discriminating monopolistand the composite cost function, answer the questions that follow:P₁ = 17-29₁P₂= 25-39₂C = 2 +9₁ +92a) Find out the equilibrium prices the monopolist would charge in twodifferent markets and total profit.b) Find the price elasticity of demand in each market and compare.

Profit is the amount earn by monopolist or any firm after reducing the marginal cost from marginal…

Given the following demand functions of a discriminating monopolist and the composite cost function, answer the questions that follow: P₁ = 17-29₁ P₂= 25-39₂ C = 2 +9₁ +9₂ a) Find out the equilibrium prices the monopolist would charge in tw different markets and total profit. b) Find the price elasticity of demand in each market and compare.

Given the following demand functions of a discriminating monopolist and the composite cost function, answer the questions that follow: P₁ = 17-29₁ P₂= 25-39₂ C = 2 +9₁ +9₂ a) Find out the equilibrium prices the monopolist would charge in tw different markets and total profit. b) Find the price elasticity of demand in each market and compare.

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

Assume quantities need not be integers. A monopolist incurs marginal cost equal to $3 per unit and faces demand P(Q)=12 – 3 x Q. What is the dead-weight loss in the market?
A single-price monopolist has the following equations representing its marginal cost and demand curves: Qd=800-1/3 P MC = 2Q What is the deadweight loss caused by this single-price monopoly?
Suppose that a monopolist faces inverse demand given by P = 100 - 10Q and marginal cost given by MC = 20. 1. What is the profit function? 2. What is the marginal revenue function? 3. What is the equilibrium quantity? 4. What is the equilibrium markup?
A monopolist has four distinct groups of customers: group A has an elasticity of demand of 0.2, group B has an elasticity of demand of 0.8, group C has an elasticity of demand of 1.0, and group D has an elasticity of demand of 2.0. The group paying the highest price for the product will be group: a) D. b) C. c) B. d) A.
The accompanying graph depicts the marginal revenue (MR), demand (D), and marginal cost (MC) curves for a monopoly a. Place point Pi at the profit maximizing price and quantitvy assuming that the monopolist can only charge a single price. 100 95 90 85 80 75 70 65 2 60 b. What are the profits of the firm if it charges a single price? 50 45 Suppose the monopolist able to successfully price discriminate between two groups by charging one group $60 and charging $35 to the other group. c. What are the firm's profits if it charges the two prices as mentioned above? 35 30 25 20 15 10 MR 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95100 Quantity
Consider a discriminating monopolist that sells a product in two isolated geographical areas. The monopolist faces the following demand functions P1 = 100 - Q1 and P2 = 80 - Q2 and the cost function is C = 6(Q1 + Q2) The authorities in market 1 impose a tax of t per unit sold in market 1. How much tax revenue do the authorities in market 1 get?
Suppose a monopolist faces a demand equation given by P=20-Q, and a marginal revenue equation given by MR = 20-2Q, and MC=AVC=ATC=$6. What is the deadweight loss associated with the monopolist? a) $8.5 b) $33.25 c) $24.5 d) $12.5
Suppose a monopolist faces a market demand that is the first two columns in the table below. Also, in the short run, assume that Total Fixed Cost equals $100 and the monopolist has Total Variable Cost according to the table. Find Total Revenue for each price and quantity combination, and then Marginal Revenue as price falls and quantity increases. Fill in the rest of the costs in the table and find profit at each price and quantity combination as the difference between Total Revenue and Total Cost. If profit is less than zero that indicates a loss. What is the maximum profit you found in this table? At what quantity and price combination is profit maximized for this monopolist? Next, verify this result by using Marginal Analysis to find the profit maximizing price and quantity combination. For each quantity, ask yourself if Marginal Revenue exceeds Marginal Cost. If it does, then profits would be increased by producing that quantity. As you go down the table to higher quantities, stop…
= 240 + 0.5Q², and face 4. A monopolist has the cost function TC(Q) market demand P = 45 – Q. (a) Find the monopoly equilibrium price and output. Find the monopolist's profit.
What is meant by the term “market power”? Can a monopolist charge any price it wants because it is the only seller? What is the profit maximizing /loss minimizing rule a firm should follow regardless of the market structure within which the firm is operating? If the monopolist is incurring a short run economic loss, what are some options the monopolist has?
An amusement park has identified its demand functions as follows: Q = 50-3P The marginal operating cost of each unit of quantity is $5 and there are no fixed costs. The park is a monopolist and exercises significant price making power in the market. 1. If the monopolist charges same price for every unit, for what price are his profits maximized? How many units will be sold at that price? What are his total profits?
Question is in attached image. Thank you! Only answer D,E,F