The diagram shows a pharmaceutical firm's demand curve andmarginal cost curve for a new heart medication for which the firmholds a 20-year patent on its production.At its profit-maximizing level of output, it will generate a deadweightloss to society represented by what?O A. Area C+B+A+DB. There is no deadweight loss generated.C. Area C+ BD. Area B+ A+DE. It is not possible to determine with the informationprovided.CaPoP₁P₂PriceIEOF GBAMCD OutputQN

Ans. ) Below is the answer to the question...Explanation:Ans. ) Given the graph of a pharmaceutical…

Answered: The diagram shows a pharmaceutical…

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 6 Which of the following is an example of a barrier to entry? O a. All other options are the examples of barriers to entry. O b. A pharmaceutical company invented a new drug to cure lung cancer and got patent. OC. An author just got a copy right for her newly published book. O d. A cable company owns the exclusive rights to provide cable services in a county. QUESTION 7 There is only one cable TV provider in a small town. The cable TV provider in that area will face O a perfect competition. O a monopoly. O a government-regulated price. O a price decided by the industry. QUESTION 8 For a monopolist a profit-maximizing quantity will be where their O marginal revenue is less than marginal cost. O marginal revenue is greater than marginal cost. O marginal revenue is equal to marginal cost. O average revenue is greater than the average cost.
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*
Questión 10 óf 18 Holiday Beach is a world-renowned beach operated by Holiday Town. The beach is remotely located and the only parking area for the beach is controlled by the town government. The graphs depict the marginal revenue (MR) and demand (D) for daily parking passes for tourists and residents. Tourists Residents Price per day Price per day $20 $207 18 18 16 14 14 12 12 D 10 - 10 8 8 6 6 MR 4 4 MR 2 1 2 3 4 6. 7 8 9. 10 1 2 3 4 7 8 9 10 Quantity of passes Quantity of passes Suppose Holiday Town issues registration plates to its residents to make it easy to determine which cars belong to residents and which cars belong to tourists. Assume the marginal cost of providing a daily parking pass is a constant $4 and Holiday Town wishes to price discriminate. What price will town residents be charged for a daily pass? $ %24
5. Assume a movie theater that has a fixed cost of 500 dollars regardless of how many people come to the movie if it is open. There exists two types of customers: students and adults with demand functions ys = 220 – 40p, and ya = 140 – 20pa. • If the movie theater can discriminate the customers by checking student id cards, what will be the prices for students and for the adults if the movie theater maximizes profit? • What will be the total profit?
PRICE (Dollars per subscription) 100 90 80 70 60 50 40 30 20 10 0 0 2 4 Pricing Mechanism Profit Maximization " 6 10 12 14 QUANTITY (Thousands of subscriptions) Marginal-Cost Pricing Average-Cost Pricing T 8 Complete the first row of the following table. MR O True O False Suppose the government has elected not to impose regulations on the industry, and so the firm faces no regulatory constraints in maximizing profits. 16 Complete the second row of the previous table. ATC MC Complete the third row of the previous table. D 18 20 Short Run Price Quantity (Subscriptions) (Dollars per subscription) Suppose now that the government decides to require the monopolist to set its price equal to marginal cost. Profit Suppose now that the government decides to require the monopolist to set its price equal to average total cost. Long-Run Decision True or False: Over time, the internet service provider has a very strong incentive to lower costs when subject to average-cost pricing regulations.
QUESTION 11 Suppose that a pure monopolist can sell 5 units of output at $4 per unit and 6 units at $3.90 per unit. The monopolist will produce and sell the sixth unit if its marginal cost is: O A. S4 or less O B. S3.90 or less O C. $3.50 or less D. S3.40 or less
Cost & Figure 15 Revenue $10 per unit MC $9 $8 АТС $7 $6 $5 $4 $3 $2 $1 MR 2 3 4 7 8 10 Quantity (in thousands) Refer to the above Figure 15 which shows cost curves, a marginal revenue (MR) curve and a demand curve faced by a monopolist. If this monopolist is profit maximizing and does not price discriminate, it will produce ( Select ] v units of output and charge a price of [ Select ] per unit. Given its cost curves, we can tell that this monopolist is currently earning [ Select ] economic profit. According to the classical welfare economics, the socially efficient quantity to be produced in this market would be [ Select ] units of output and a socially efficient price would be [Select ] per unit.
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While firms in perfect competition maximize profit by producing at a quantity where the marginal cost of producing another unit of a good is equal the the marginal revenue from producing another unit, monopoly firms will maximize profit by producing at a quantity where marginal cost of producing another unit is equal to the marginal revenue (the same as perfect competition) the marginal profit the average total cost O the price of the good 10:04 P Bi 63°F Cloudy 5/20/202 e here to search O
1. When a monopoly advertises, the goal is to _____ because _____. Group of answer choices increase its demand as a share of market demand; the monopoly faces a significant portion of market demand increase market demand; the monopoly faces the entire market demand increase market demand; the monopoly produces a product that is identical to the output of all other sellers in the market increase its demand as a share of market demand; the monopoly faces a small portion of market demand 2. If given a choice, a person would prefer to experience the situation of which of the following families? Group of answer choices a family with income equal to the world poverty line a family with income equal to the United States poverty line a family with income double the world poverty line a family with income equal to the poverty line in the United States in 1970 3. A business using its bargaining power as a major buyer of labor to pay lower prices, including lower wages,…
Which of the following statements is not correct? Select one: A single price monopolist is more efficient than perfectly competitive market because it makes a larger profit. a. O b. A single price monopolist produces less than the competitive market. O c. A single price monopolist charges more than the competitive market. d. A single price monopolist faces a downward sloping demand curve. A single price monopolist increases produces surplus at the expense of e. consumer surplus.

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