Q9. A fundamental feature of a monopolistic market is that the firm a) can sell any quantity it desires at the current market price b) can obtain any price for any quantity of output c) faces a perfectly inelastic demand curve d) faces the price and quantity trade-off dictated by market demand

Q9. A fundamental feature of a monopolistic market is that the firm a) can sell any quantity it desires at the current market price b) can obtain any price for any quantity of output c) faces a perfectly inelastic demand curve d) faces the price and quantity trade-off dictated by market demand

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

Suppose the market for cereal is monopolistically competitive and in long-run equilibrium. The demand (and marginal revenue) for a firm in this industry is illustrated in the graph to the right, along with that firm's average total cost and marginal cost of producing its brand of cereal. Compared to perfectly competitive markets in the long-run, monopolistically competitive markets, such as that for cereal, allocatively efficient because they produce excess capacity. For example, according of thousand boxes. are are not onopolistically competitive firm has excess capacity esponse using an integer.) 150 135- 120- 105- 90- 75- 60- 45- 30- 15- Price and cost (dollars per box) MC ATC MR D 10 20 30 40 50 60 70 80 90 100 Quantity of cereal (per week in 1000s) Q Q
Consider a monopolistically competitive market in long-run equilibrium, and a firm that is in the market. Suppose there is a shortage of a key input, so that every firm's ATC curve shifts up by a fixed amount. If the firm remains in the market in the new long-run equilibrium, what happens to the price at which it sells the good, and what quantity does it sell? Price goes down, quantity stays the same Price goes up, quantity stays the same Price goes down, quantity goes down Price goes up, quantity goes down
Which of the following is a common characteristic between a monopolistic competition firm and a monopoly firm. Question 12 options: 1) Both firms have market power to set price. 2) Both firms only make normal profit in the long run. 3) Both firms are productive efficient in the long run. 4) Both firms enjoy economies of scale in production in the short run.
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 indicate the minimum average total cost the firm faces and the quantity associated with that cost PRICE (Dollars per shirt) 0 10 20 True O False MR Demand 60 QUANTITY (Thousands of shirts) ATC 40 BO 190 100 Mon Comp Outcorne Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that optimal quantity for each firm. Furthermore, the quantity the firm produces in long-run equilibrium is Min Unit Cost True or False: This indicates that there is a markup on marginal cost in the market for shirts. at the the efficient scale.
Q9. A fundamental feature of a monopolistic market is that the firm ________. * a) can sell any quantity it desires at the current market price b) can obtain any price for any quantity of output c) faces a perfectly inelastic demand curve d) faces the price and quantity trade-off dictated by market demand Q2. Which of the followings is an appropriate statement about the "limit pricing" strategy"? * a) The strategy is most effective in a perfectly competitive market. b) Goods and services are sold by suppliers at a price higher than the short-term profit maximizing level. c) The main purpose of the strategy is to protect the existing firm's long-run profits from damage by competition. d) The main purpose of the strategy is to charge each customer the maximum price he or she is prepared to pay for the product. Q3. Which of the followings is an example of second degree price discrimination? * a) Ladies' night in a bar b) Half-price tickets for kids in the cinema…
). Explain why a monopolistically competitive firm switches from charging a single price to Third-Degree Price discrimination (Hint: SR vs LR). Explain and graph.
The market for peanut butter in Nutville is monopolistically competitive and in long-run equilibrium. The following graph shows the marginal-cost (MC) curve and the average-total-cost (ATC) curve for a peanut-butter-producing firm. It also shows the demand curve and marginal-revenue (MR) curve faced by a firm operating in a monopolistically competitive environment. On the following graph, use the black point (plus symbol) to show the profit-maximizing output and price for a typical firm operating in a monopolistically competitive environment.
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…
How do perfectly competitive firms, monopolists, monopolistically competitive firms, and cartels choose the profit -maximizing quantity? A) The quantity at which average total cost is minimizedB) The quantity at which total revenue and total cost are equalC) The quantity at which total revenue is maximizedD) The quantity at which marginal revenue and marginal cost are equal
A monopolistically competitive firm faces the following demand schedule for its product. In addition, the firm has total fixed costs equal to 20. Price Quantity $30 $26 $22 $18 $14 $10 16 $6 Refer to Table 16-7. If the firm has a constant marginal cost of $7 per unit, how much profit will the firm earn at the profit-maximizing level of output? $24 $25 $41 $66
The accompanying graph depicts average total cost (ATC) marginal cost (MC), marginal revenue (M), and demand (D) 50 facing a monopolistically competitive firm MC 45 Place point A at the firm's profit maximizing price and quantity 40 35 What is the firm's total cost? ATC 30 25 total cost: 20 15 What is the firm's total revenue? 10 5 total revenue: $ MR 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95100 Quantity What is the firm's total profit? profit: $ Price and Cost ($)
Which of the following statements best describes the long run adjustment in a monopolistic competition market that has short-run profit? One or more competitors closes, increasing the demand for the output of an existing seller in the monopolistic competition. The existing seller’s profits increase and positive profit is sustained in the long run. One or more competitors opens, reducing the demand for the output of an existing seller in the monopolistic competition. The existing seller’s profits decline and the seller incurs losses and exits the industry in the long run. One or more competitors closes, increasing the demand for the output of an existing seller in the monopolistic competition. The existing seller’s profits increase until there is zero profit in the long run. One or more competitors opens, reducing the demand for the output of an existing seller in the monopolistic competition. The existing seller’s profits decline and the seller earns zero profit in the long…