Robert has a passion for making ice cream. Assume that ice cream parlors have a market structure of monopolisticcompetition. Between the local Amy's, Cold Stone Creamery, Marble Slab, Ben & Jerry's, and Baskin Robbins, he has anuphill battle to break into the local ice cream market.Robert is considering various strategies to differentiate his ice cream shop, JubJub's, so that he can garner some marketpower. Indicate the value of each suggestion.a. Making ice cream using fresh organic milk and fruit, something none of the other competitors are doing.help Robert differentiate his ice cream.b. Opening JubJub's next to "The Triangle," an area with an elementary school, a middle school, and a high5 minutes awayhelp Robert differentiate his ice cream.c. Carrying only the exact same flavors, with the same names, as his competitorshis ice cream.d. Pricing JubJub's ice cream at $100 a scoop to appeal to the luxury crowdcream.willwill nothelp Robert differentiatehelp Robert differentiate his iceח

Approach to solving the question: In answering the questions, I used an evaluative approach to…

Answered: Robert has a passion for making ice…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Similar questions

If a monopolistically competitive firm is earning positive profits in the short-run, then we would expect more competition to enter the industry assuming there are no barrier to entry in the market: True or False
In a market where firms are monopolistically competitive: Group of answer choices There is one firm that produces a standardized product. There are few firms, each producing a very differentiated product. There are market participants who are all price takers. There are many firms producing a differentiated product.
ou are hired as a consultant to a monopolistically competitive firm. The firm reports the following information about its price, marginal cost, and average total cost: P<MC, P>ATCP<MC, P>ATC Which of the following statements are true about the firm? Check all that apply. The firm is possibly maximizing profit. The firm is in long-run equilibrium. The firm can increase its profit by reducing its output.
6
Suppose the percentage of business sales the top firms have in some industry are respectively, 25%, 20%, 7%, 6%, 5%, and 4%. Calculate the CR(6), and determine the type of competition the industry is. Calculate the HHI
Firms compete in different types of market structures. In the real world, most markets are either monopolistically competitive or oligopolistic, and a few markets have a monopoly. Note that perfect competition is rare because no market has all the characteristics of a perfectly competitive market as described by the theory of perfect competition. Explain which firm is likely to face a more elastic demand curve: a monopoly or a pizza shop?
Assume the figure on the right shows the cost structure for a monopolistically competitive firm selling a particular brand of shoes. MC is the marginal cost curve and AC is the average cost curve. If this firm produces 2 thousand pairs of shoes, does it minimize average cost? How much more would they need to produce to reach minimum average cost? The firm needs to produce an additional thousand pairs of shoes to reach minimum average cost. (Enter your response as an integer.) SEED Price (dollars per pair) 80- 72- 64- 56- 48- 40- 32- 24- 16- 8- 0- 0 1 Quantity (in thousands) MC AG 10 Q 20
In competitive market structure, firms earn zero economic profit in the long run but still remain in the market. Firms facing loss in short run may continue to produce in a competitive market structure. Price discrimination is beneficial for the society in general but it is difficult to practice in real world. Monopolistically competitive firms are producing efficiently because P=MC in the long-run. 5. Advertising helps raise revenue for the firms and provides information to the customers; therefore, expenditures on advertising are justified.
How do pricing strategies vary across markets that are characterized bymonopolistic, oligopolistic, monopolistic competition, and purecompetition?
Q2: You have a small decoration business primarily making custom paper mache pinata's. Monopolistic Competition. Each customer has unique custom order, therefore it is very difficult to figure out the marginal cost of each output. You charge a price of $15 for any small two foot by two foot pinata's. Without marginal cost, how can you check to see if the small pinata's were profitable?
Compare the characteristics of monopolistic competition (MC) and oligopoly (O) based on the following: Questions: 1. Barriers to entry. 2. Profit in the long-run. 3. Shape of demand curve. 4. The relationship between P and MR (P is equal, below, or above MR). 5. The ATC point at profit maximising output (minimum ATC or not minimum ATC). Clearly label each of your answers in the text box below.
I understand how to compute the revenue but I'm stuck on computing the elasticity.

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