The single-price monopolist illustrated in the figure above earns an economic profitofMCATC10AVC4.M28.Quan lily funib per day4.1012O A. zero.OB. $8 per day.OC. $10 per day.OD. $40 per day.O E. $60 per day.2.2.Price and cost (dollars peruniß

A monopoly is a sole producer of a good in the market thus having maximum market power and thus act…

e single-price monopolist illustrated in the figure above earns an economic profit MC ATC 10 AVC MR 2 8 10 12 Quan hily funib per day A. zero. B. $8 per day. C. $10 per day. D. $40 per day. E. $60 per day. 4. 00 2. Price and cost (dollars perunil

e single-price monopolist illustrated in the figure above earns an economic profit MC ATC 10 AVC MR 2 8 10 12 Quan hily funib per day A. zero. B. $8 per day. C. $10 per day. D. $40 per day. E. $60 per day. 4. 00 2. Price and cost (dollars perunil

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

The single-price monopolist illustrated in the figure above earns an economic profit
of
MC
ATC
10
AVC
4.
M2
8.
Quan lily funib per day
4.
10
12
O A. zero.
OB. $8 per day.
OC. $10 per day.
OD. $40 per day.
O E. $60 per day.
2.
2.
Price and cost (dollars peruniß

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Exhibit 9-4: A Monopoly Total Quantity Total Fixed Variable Price Demanded Cost Cost $100 $20 $0 ts 90 1 $20 20 80 $20 48 70 $20 78 ments 60 4 $20 110 50 $20 150 Refer to Exhibit 9-4. At an output level of 4 units, the monopolist earns a total profits of about Tutoring $112.00 shboard $118.00 $110.00 O $120.00 erts
9
2. To exploit their market power, monopolists choose to sell a quantity that is larger thanthat which would be produced if the market were competitive.(a) True. (b) False.
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9. Draw a linear demand curve, linear MC and MR for a monopolist. (a) Show graphically the optimal price and quantity produced. (b) How will your answer in (a) change if the demand becomes more inelastic? Will the gap between MC and p increase or decrease? (c) Show the CS, PS, and, DW L.
ATC MC, $59 $50 $45 $38 $35 $26 $12 ........ MR 38 74 82 90 Refer to the figure above. It illustrates a monopoly market. Suppose the monopolist wants to maximize its profit. What price should the monopolist charge? Select one: O a. $35 Ob. $82 Oc. $50 O d. $45
Quantity Demanded Price $8 $7 6. $6 7 $5 8 $4 $3 10 $2 11 TABLE 10- 1 Refer to Table 10 - 1. For a single – price monopolist, the marginal revenue associated with increasing sales from 6 to 7 units is A. -4. В. 4. С. 2. D. - 2. O E. 0.
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
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3. Suppose that a monopoly has the following demand curve and total costs: 오 P TR TC ATC MC MR Total Profit 50 40 1 45 50 2 40 72 - 3 35 95 - 4 30 125 - 25 165 6 20 225 a. Fill in the blanks in the preceding table. b. What output will maximize the monopolist's profit? c. What price will the monopolist choose?