Use the following to answer questions (1) through (6): Suppose firm A is currently the only firm in a market and thus currently behaving as a monopolist. The market demand is given as: Q = 100 - P, where Q is the market quantity and Pis the market price. Now, firm Bis contemplating entering the market. Further, suppose A and B have total costs that are zero at all output levels. Note: A's and B's quantities produced are denoted Q, and Qs, respectively. (1) In the pre-entry period (i.e., when A is a monopolist), A would most desire to price the product at: А. S100 В. S75 C. $50 D. $25 [2] In the pre-entry period (i.e., when A is a monopolist), A's maximum profit exceeds $2000. A. True В. False [3] Assuming the Sylos Postulate holds, this is a case of blockaded entry. А. True В. False [4] Assuming the Sylos Postulate holds, if A produces its pre-entry profit-maximizing quantity, then B's inverse demand is given as: P = 25 - 2Q, P= 25 - Qu P= 50 - Q. А. В. С. D. None of the above [5] Assuming the Sylos Postulate holds, if B enters the market then A will see its profit fall to: А. $2500 В. $1250 C. $625 D. None of the above [6] The limit price equals: A. S100 В. $50 $25 С. D. None of the above
Use the following to answer questions (1) through (6): Suppose firm A is currently the only firm in a market and thus currently behaving as a monopolist. The market demand is given as: Q = 100 - P, where Q is the market quantity and Pis the market price. Now, firm Bis contemplating entering the market. Further, suppose A and B have total costs that are zero at all output levels. Note: A's and B's quantities produced are denoted Q, and Qs, respectively. (1) In the pre-entry period (i.e., when A is a monopolist), A would most desire to price the product at: А. S100 В. S75 C. $50 D. $25 [2] In the pre-entry period (i.e., when A is a monopolist), A's maximum profit exceeds $2000. A. True В. False [3] Assuming the Sylos Postulate holds, this is a case of blockaded entry. А. True В. False [4] Assuming the Sylos Postulate holds, if A produces its pre-entry profit-maximizing quantity, then B's inverse demand is given as: P = 25 - 2Q, P= 25 - Qu P= 50 - Q. А. В. С. D. None of the above [5] Assuming the Sylos Postulate holds, if B enters the market then A will see its profit fall to: А. $2500 В. $1250 C. $625 D. None of the above [6] The limit price equals: A. S100 В. $50 $25 С. D. None of the above
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
help on question 4-6 please
![Use the following to answer questions (1) through (6):
Suppose firm A is currently the only firm in a market and thus currently behaving as a monopolist. The
market demand is given as: Q = 100 - P, where Q is the market quantity and P is the market price. Now, firm
B is contemplating entering the market. Further, suppose A and B have total costs that are zero at all output
levels. Note: A's and B's quantities produced are denoted Qa and QB, respectively.
[1]
In the pre-entry period (i.e., when A is a monopolist), A would most desire to price the product at:
A.
$100
$75
$50
В.
C.
D.
$25
[2]
In the pre-entry period (i.e., when A is a monopolist), A's maximum profit exceeds $2000.
A.
True
В.
False
[3]
Assuming the Sylos Postulate holds, this is a case of blockaded entry.
A.
True
В.
False
[4]
inverse demand is given as:
Assuming the Sylos Postulate holds, if A produces its pre-entry profit-maximizing quantity, then B's
P = 25 - 2QB
P = 25 - QB
P = 50 - QB
A.
В.
C.
D.
None of the above
[5]
Assuming the Sylos Postulate holds, if B enters the market then A will see its profit fall to:
A.
$2500
$1250
$625
В.
C.
D.
None of the above
[6]
The limit price equals:
A.
$100
В.
$50
С.
$25
D.
None of the above](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb17dca31-9e9b-409c-a2ff-191d71fb3cfd%2F08d95dce-0ce0-449c-b503-21d9cf23f361%2Fbnaqh9_processed.png&w=3840&q=75)
Transcribed Image Text:Use the following to answer questions (1) through (6):
Suppose firm A is currently the only firm in a market and thus currently behaving as a monopolist. The
market demand is given as: Q = 100 - P, where Q is the market quantity and P is the market price. Now, firm
B is contemplating entering the market. Further, suppose A and B have total costs that are zero at all output
levels. Note: A's and B's quantities produced are denoted Qa and QB, respectively.
[1]
In the pre-entry period (i.e., when A is a monopolist), A would most desire to price the product at:
A.
$100
$75
$50
В.
C.
D.
$25
[2]
In the pre-entry period (i.e., when A is a monopolist), A's maximum profit exceeds $2000.
A.
True
В.
False
[3]
Assuming the Sylos Postulate holds, this is a case of blockaded entry.
A.
True
В.
False
[4]
inverse demand is given as:
Assuming the Sylos Postulate holds, if A produces its pre-entry profit-maximizing quantity, then B's
P = 25 - 2QB
P = 25 - QB
P = 50 - QB
A.
В.
C.
D.
None of the above
[5]
Assuming the Sylos Postulate holds, if B enters the market then A will see its profit fall to:
A.
$2500
$1250
$625
В.
C.
D.
None of the above
[6]
The limit price equals:
A.
$100
В.
$50
С.
$25
D.
None of the above
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