Economics: Principles, Problems, & Policies (McGraw-Hill Series in Economics) - Standalone book
20th Edition
ISBN: 9780078021756
Author: McConnell, Campbell R.; Brue, Stanley L.; Flynn Dr., Sean Masaki
Publisher: McGraw-Hill Education
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 12.4, Problem 4QQ
To determine
Profit maximizing output.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
In the short run, a monopolist will shut down if it is producing a level of output where marginal revenue is equal to short run marginal cost and price is:
A. Greater than average total costB. Less than average total costC. Greater than average variable cost
D. Less than average variable cost
QUESTION 1
A. The total cost function for a monopolist is given by TC = 44,000 + 180Q + 0.03Q² and the demand
function is P = 420 – 0.06Q per unit of output.
i.
What is the profit maximising level of output?
ii.
Calculate the profit maximizing price.
iii.
Calculate total profit at the profit maximising level of output.
If a monopolist's marginal revenue is $3.00 and its marginal cost is $4.00, it will increase its profits by:
A. reducing output and raising price
B. Reducing both output and price
C. Increasing both output and price
D. Raising price while keeping output unchanged
Chapter 12 Solutions
Economics: Principles, Problems, & Policies (McGraw-Hill Series in Economics) - Standalone book
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Similar questions
- A monopolist has a demand curve given by Q=100-P and a total cost curve given by TC= Q2 + 16. a.Find the monopolist’s profit maximizing quantity and price. Indicate them on the graph. b.How much economic profit will the monopolist earn? c. Calculate the price elasticity of demand at the equilibrium price level.arrow_forwardA monopolist A.) Has perfectly inelastic demand curve B.) Is a price taker C.) Can always increase price to increase economic profit D.) Is rhe price maker E.) Has no control over the market price of the product it sellsarrow_forwardWhen a monopolist switches from charging a singleprice to practicing perfect price discrimination, itreducesa. the quantity produced.b. the firm’s profit.c. consumer surplus.d. total surplus.arrow_forward
- Exercise 3.3. Suppose a profit-maximizing monopolist is producing 800 units of output and is charging a price of $40 per unit. a. If the elasticity of demand for the product is -2, find the marginal cost of the last unit produced. b. What is the firm's percentage markup of price over marginal cost? c. Suppose that the average cost of the last unit produced is $15 and the firm's fixed cost is $2000. Find the firm's profit.arrow_forward30. A monopolist will spend resources to advertise its product so long as A) net profits increase.B) gross profits increase.C) demand increases.D) total revenue increases.arrow_forwardFor a monopolist to produce one more unit of output, Select one: a. the price must be equal to the marginal cost b. the difference of total revenue gained and total revenue lost must be greater than zero c. the price must be equal to the average variable cost. d. demand must be in the in inelastic range of the demand curve e. the difference of the price and marginal revenue must be equal to zeroarrow_forward
- answer quicklyarrow_forwardCurrently, a monopolist's profit-maximizing output is 400 units per week and it sells its output at a price of S60 per unit. The firm's total costs are $10,000 per week. The firm is maximizing its profit, and it earns $40 in extra revenue from the sale of the last unit produced each week. a. What are the firm's weekly economic profits? b. What is the firm's marginal cost? c. What is the firm's average total cost?arrow_forward1. The table shows the demand schedule of a monopolist. Calculate marginal revenue and fill in the revenue column in the table. Assume that output can only be sold in integer amounts (i.e., 1 unit, 2 units, etc.). 2. Once you have filled in marginal revenue, identify the quantity produced by the monopolist in this market.arrow_forward
- It is possible for a monopolist's to earn economic profits even in the long run due to: a. its barriers to the entry of other firms. b. the nature of the monopolist's product. c. its practice of third-degree price discrimination.arrow_forwarda. At what output rate and price does the monopolist operate? b. In equilibrium, approximately what is the firm’s total cost and total revenue? c. What is the firm’s economic profit or loss in equilibrium?arrow_forwardSuppose a monopolist's profit maximizing output is 200 units per week and that the firm sells its output at a price of $60 per unit. the firm has total cost of $9000 per week assume the monopolist is maximizing its profit and earns $30 per unit from the sale of the last unit produced each week. a. What Are the firms weekly economic profits? $ b. What is the firms marginal cost? $ c. What is the firms average total cost? $arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Economics (MindTap Course List)EconomicsISBN:9781337617383Author:Roger A. ArnoldPublisher:Cengage Learning
Managerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage Learning
Economics (MindTap Course List)
Economics
ISBN:9781337617383
Author:Roger A. Arnold
Publisher:Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning