The figure on the right shows the demand schedule for a productproduced by a single-price monopolist.Price ($)10987654QuantitydemandedA. 9; 10; -1B. 40; 45; 5C. 36; 41; 5D. 5; 4; 1E. 15; 15; 0456789210Using the graph on the right, suppose this single-price monopolistis initially selling 4 units at $10 each and then reduces the price ofthe product to $9. By making this change, the firm is giving uprevenue ofItsand gaining revenue ofmarginal revenue is therefore(All figures are dollars.)Price ($)14113-12-11-10-9-6-5-4-3-2-1--N4 5 6 7 8 9 10 11 12 13 14 15 16QuantityQQ

Correct option:B.40,45,5Pls, refer the below explanation: Explanation:Let's solve the problem step…

Answered: The figure on the right shows the…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Elixir Springs, Inc., is an unregulated European natural monopoly that bottles Elixir, a unique health product with no substitutes. The total fixed cost incurred by Elixir Springs is €150,000,€150,000, and its marginal cost is 10 cents a bottle. The figure illustrates the demand for Elixir.a What is the price of a bottle of Elixir?b How many bottles does Elixir Springs sell?c Does Elixir Springs maximize total surplus or producer surplus?
Question 2: Suppose a monopoly firm produces bicycles and can sell 10 bicycles per month at a price of $700 per bicycle. In order to increase sales by one bicycle per month, the monopolist must lower the price of its bicycles by $100 to $600 per bicycle. What is the marginal revenue of the eleventh bicycle?
Title Suppose there are two classes of buyers in a market served by a monopolist. Description Suppose there are two classes of buyers in a market served by a monopolist. At this point the two classes are lumped together and the monopolist is currently producing the profit maximizing quantity based upon being a single price monopolist. Suppose that the monopolist perceives that its relevant market demand curve is given by the equation P = (40/3) – (2/3)Q and its MC = ATC = 4. a. Suppose this monopolist acts as a single price monopolist. Calculate the monopolist’s price, quantity, and profit given the above information. Now, suppose that the monopolist realizes that the two classes of buyers have different demand curves and that the first class of buyers demand curve is given by the equation P = 10 – Q while the second class of buyers demand curve is given by the equation P = 20 – 2Q. Assume for the rest of this problem that this monopolist will practice third degree price…
Exercise A.9 You are an executive of Super Computer, INC. (SC), which rents supercomputers. SC receives a fixed rent for a period of time in exchange for the right use unlimited computers equal to P cents per second. SC has two types of potential clients of equal numbers: 10 companies and 10 academic institutions. Each company has the demand function Q = 10 - P, where Q is expressed in millions of seconds per month; each academic institution has the demand Q = 8 - P. The marginal cost to SC of additional computer utilization is 2 cents per second, regardless of volume. a) Suppose you can distinguish companies from academic clients. What rental and usage fee would you charge each group? Calculate the profits you would get? b) Suppose that you cannot separate the two types of customers and that you did not charge a rental fee. What usage quota would maximize your profits? How many benefits would you get?
Suppose that Comcast has a cable monopoly in Philadelphia. The following table gives Comcast's demand and costs per month for subscriptions to basic cable (for simplicity, we keep the number of subscribers artificially small). Total Marginal Total Marginal Price Quantity 3 Revenue Revenue Cost Cost 68 204 144 64 4 256 52 172 28 60 300 44 204 32 56 336 36 240 36 52 7 364 28 280 40 48 384 20 324 44 Suppose the local government imposes a $99 per month tax on cable companies. What will Comcast do? (Assume fixed costs equal $60.) A. Comcast should produce 6 units in the short run and shut down in the long run. B. Comcast should shut down in the short run and in the long run. c. Comcast should produce 6 units in the short run and in the long run. D. Comcast should shut down in the short run and produce 6 units in the long run. E. None of the above. Suppose that the flat per-month tax is replaced with a tax on the firm of $4 per cable subscriber. (Assume that Comcast will sell only the…
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Problem 2 Elixir Springs is a natural monopoly that bottles Elixir, a unique health product with no substitutes. The total fixed cost incurred by Elixir Springs is $150,000, and its marginal cost is 10 cents a bottle. The figure illustrates the demand for Elixir. a) What is the price of a bottle of Elixir and how many bottles does Elixir Springs sell? b) Does Elixir Springs maximize total surplus or producer surplus? Figure 1 Elixir Springs 50 40 30 20 ATC 10 MC MR 0.5 1.0 1.5 2.0 2.5 Quantity (millions of bottles/year) Price (cents per bottle)
The table below shows the demand schedules for Houston–Las Vegas airplane tickets. The center column shows the demand schedule of passengers on business trips, and the right column shows the demand schedule of passengers on vacation trips. Price ($ per ticket) Quantity demanded for business trips (thousands of tickets per year) Quantity demanded for vacation trips (thousands of tickets per year) $281 363 778 $291 359 669 $301 355 467 Suppose that the price charged by airlines is currently $291291. If airlines want to increase their revenue, what would be their best option? to charge $301 to vacationers and $281 to business travelers. to charge $291 to both vacationers and business travelers. to charge $281 to vacationers and $301 to business travelers. to charge $301 to both vacationers and business travelers. to charge $281 to both vacationers and business travelers.
E PRICE (Dollars per gigabyte of data) The following graph gives the demand (D) curve for 5G LTE services in the fictional town of Streamship Springs. The graph also shows the ma revenue (MR) curve, the marginal cost (MC) curve, and the average total cost (ATC) curve for the local 5G LTE company, a natural monopolist On the following graph, use the black point (plus symbol) to indicate the profit-maximizing price and quantity for this natural monopolist. 20 18 ATC 2 MR MC D 0 0 1 2 3 4 5 6 7 8 9 10 QUANTITY (Gigabytes of data) Monopoly Outcome Which of the following statements are true about this natural monopoly? Check all that apply. In order for a monopoly to exist in this case, the government must have intervened and created it. The 5G LTE company is experiencing diseconomies of scale. The 5G LTE company is experiencing economies of scale. It is more efficient on the cost side for one producer to exist in this market rather than a large number of producers. True or False: Without…
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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 by
Suppose a local utility company provides electricity to a small town. The figure to the right illustrates the utility company's marginal cost of providing electricity along with the town's demand for electricity. Part 2 Assume the local utility company is a monopoly. Use the triangle drawing tool to shade in the dead weight loss created by the monopoly (compared to if the market were perfectly competitive). Properly label this shaded area. Part 3 Carefully follow the instructions above, and only draw the required objects. ... Question content area right Part 1 010203040506070809010000.020.040.060.080.10.120.140.160.180.20.220.24Quantity of electricity (kilowatt hours in millions)Price and cost (dollars per kilowatt hour) MCMC Upper DD MR

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