If this firm is a monopoly, at what quantity will profit be maximized? If this is a perfectly competitive market, which quantity will be produced? Comparing monopoly to perfect competition, which statement is true? The monopoly's price is higher. The perfectly competitive market's ouput is lower. The consumer surplus is smaller with a monopoly. quantity: quantity:

If this firm is a monopoly, at what quantity will profit be maximized? If this is a perfectly competitive market, which quantity will be produced? Comparing monopoly to perfect competition, which statement is true? The monopoly's price is higher. The perfectly competitive market's ouput is lower. The consumer surplus is smaller with a monopoly. quantity: quantity:

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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A Monopoly has [Select] producer(s), products are [ Select ] |, it is [Select ] to enter the market, and producers in a monopoly have [Select ] control over prices.
Suppose that the demand curve for a good is P = 100 – 2Q. The marginal cost curve of a firm in the industry is given by MC = 3Q. Calculate and compare the equilibrium price and quantity under monopoly and perfect competition.
a) Using the following graph state the price and quantity the firm will be at if the monopoly market is in long run equilibrium. Explain why the firm will be at that price and quantity. Price MC P3 ATC AVC P2 P1 Po D Qo MR Quantity b) State the conditions that establish the market structure monopoly, and the conditions needed for price discrimination and why firms price discriminate.
Which of the following is a characteristic of a monopoly? Responds to changes in the market price. It is one of several suppliers in a market. It faces no significant competition.
Suppose that market demand is Q = 660 – 12P and marginal cost is MC = 5. The producer surplus in a perfectly competitive market is $ while the producer surplus in a monopoly market is $ 0; 7,500 0; 3,750 0; 15,000 5,000; 3,750
Which of the following statements is true of a monopoly as compared to a perfectly competitive market with the same costs? * Consumer surplus is smaller. Profit is smaller. Deadweight loss is smaller. Total surplus is larger. O Quantity is larger.
Conditions for price discrimination Price discrimination is the practice of selling the same good at more than one price when the price differences are not justified by cost differences. Evaluate the following statement: "Price discrimination is not possible when a good is sold in a perfectly competitive market." False, because perfectly competitive firms do not profit - maximize by setting marginal revenue equal to marginal cost True, because perfectly competitive firms have no market power False, because perfectly competitive firms have market power None of these choices Examples of price discrimination Cho and Ginny are debating the use of coupons by grocery stores. Cho says, "The use of coupons in grocery stores represents a means of price discrimination. It's pure and simple. Coupons do reduce the price of groceries, but mostly to people who are less likely to buy at the full price." By contrast, Ginny contends, "Coupons do not constitute price discrimination. They simply…
a) Using the following graph state the price and quantity the firm will be at if the monopoly market is in long run equilibrium. Explain why the firm will be at that price and quantity. b) State the conditions that establish the market structure monopoly, and the conditions needed for price discrimination and why firms price discriminate. (image attached)
Understand economies of scale. At what point are there economies of scale and at what point are there diseconomies of scale? What does this have to do with the monopolist? Long-Run ATC Unit Costs a Q₁ Q₂ Output Q₂
The Spacing Guild has a monopoly on space transport. They sell tickets(Q) for seats on starships for interstellar travel at a per-ticket price of P. Alltickets cost the same. The Marginal Cost for each seat is $16 and there are no other costs.Market demand is Q=306-5P. What is the difference between the Guild's PRICE and the price thatwould result if interstellar travel was a perfectly competitive market?
Suppose a monopoly faces the market demand in the nearby figure. It has constant marginal cost equal to $6. Find the perfectly competitive quantity and price assuming the market is made up of producers each with marginal cost $6. Give a numeric answer for each and show them on the graph. What is the efficient quantity? Give a numeric answer and show it on the graph. Which market structure, monopoly or perfect competition, comes closer to achieving the efficient quantity? Now suppose there is a negative externality associated with producing the good of $5 per unit. Now which market structure, monopoly or perfect competition, comes closer to achieving the efficient quantity? Explain briefly.
A Wt WZ- W3+ W4 W5+- 1 1 + - 25 Q5 Q4 Q3 QZ MRP - MFC (MC₂) Q1 •SL VMP LABOR