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(2). sketch the pareto-inefficiency and dead weight loss created by monopolist.
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- dont provide handwriring solution ...In the figure below, the competitive price will be, lower than the monopolistic price, and the monopolist causes a loss in social welfare. 100 80 MC 60 40 20 MR Price and coste (cents per bottle]3. A monopolist movie streaming service has two kinds of movies in its library - Action (A) and Romantic Comedies (R). Demand: There are two groups of consumers (Group X and Group Y) for the streaming service with the following value for each movie genre: Genre A Value Group X $100 Group Y $80 Value Group X $50 Group Y $70 Cost: The cost of streaming each type of content is MCA = $0, MCR = $60. Efficient Outcome a) Describe the efficient outcome by filling the table below Should X consume? (Y/N) Should Y consume? (Y/N) Consumption of A Consumption of R Total Efficient Surplus Genre R Surplus from efficient consumption (Value - Cost)
- sketch the pareto-inefficiency and dead weight loss created by monopolist.You are the manager of a monopolistically competitive firm. The demand curve of the firm is linear, and the marginal cost is a fixed constant. a. Graphically illustrate the profit-maximizing output and price set by the monopolistic firm. b. If the government set a tax of $t per unit sold, graphically illustrate how the output and price of the monopolist’s profit maximization will change? *Please show all work*Please hand written solutions are strictly prohibited.
- 9. The kinked demand curve Wilke is a manufacturer in the oligopolistically competitive market for footballs. Two other manufacturers, Rawlding and Spaldon, compete with Wilke for football consumers. Wilke faces the kinked demand curve for footballs depicted on the graph. Initially, Wilke charges $30 per football, producing and selling 7 million footballs per year. PRICE (DOLLARS PER BALL) 36 35 34 33 32 31 30 29 28 27 28 5 в 7 8 FOOTBALLS (Millions of balls) 9 10 ? As an oligopolist, Wilke is a price maker. If Wilke raises the price of its football from $30 to $32 per ball, the quantity of Wilke footballs demanded million footballs per year. If Wilke reduces the price of its football from $30 to $28 per ball, the quantity of footballs demanded million footballs per year. (Hint: Mouse over the points on the graph to see their coordinates.) by by If Wilke lowers the price of its football below $30, the kinked demand curve model suggests that Rawlding and Spaldon will respond byUsing illustration differentiate the behavior of a monopolist that aims at maximizing profit and a monopolist that aims at maximizing revenue1. Refer to the figure below when the firm is a monopolist. Price P MC L K J ATC D T W Quaxtity \MR a) If the monopolist maximizes profit, how many units will it produce? b) What price will the monopolist charge? c) What area measure the monopolist's profit? d) What level of output would be socially efficient? 2. A Monopolist is facing a demand schedule that is shown in the following table. Quantity Total Revenue Average Revenue Marginal Revenue Price $35 $32 1 2 3 $29 14 $26 15 $23 $20 $17 $14 6 7 18 19 $11 10 $8 a) Fill out the rest of the table. b) Assume this monopolist's marginal cost is constant at $11. What quantity of output (Q) will it produce and what price (P) will it charge? ------
- Suppose a monopolist sells a product to faculty members and students on the campus. If the firm sets a single price, the monopolist produces 5000 units and sell them at the price of $3 per unit. At this price, the price elasticity of demand for faculty member is -2.5. And the price elasticity of demand for students is -1.5. The monopolist is considering whether she should set different prices for the faculty members and students and asks for your advice. The monopolist is thinking about charging faculty members a 10% higher price. The quantity demanded by the faculty members would fall by %. The monopolist is thinking about charging students a 10% higher price. The quantity demanded by the students would fall by %. Who should the monopolist charge more? mention faculty and students and how much6Describe the difference in economic profit between a competitive firm and a monopolist in both the short and long run. Which should take longer to reach the long-run equilibrium? In the short run, both monopolists and competitive firms run, economic profit. True or False: The adjustment to long-run equilibrium takes the same amount of time for monopolies and competitive industries. (Can/Cannot) earn positive economic profits. In the long _(neither/monopolists, but not competitive/both/ competitive but not monopolists) can earn a positive
