MICROECONOMICS
11th Edition
ISBN: 9781266686764
Author: Colander
Publisher: MCG
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Question
Chapter 15, Problem 18QE
To determine
The effect of the platform businesses on the nature of the antitrust policy.
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Suppose the local electrical company, a legal monopoly based on economies of scale, was split into four firms of equal size, with the
idea that eliminating the monopoly would promote competitive pricing of electricity. What do you anticipate would happen to
prices? Why?
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Is Facebook a natural monopoly or monopoly? Why or why not?
Scenario
Use the following information to answer questions 16-19.
The graph below shows the market demand for computers in a small country. To develop a domestic
computer industry, the government prohibits imports of computers and gives a single local firm the
sole right to produce and sell computers (that is, it is a legal monopoly). The demand curve shows the
local demand for computers. The cost curves show the marginal cost (MC) and average total cost
(ATC) of the single producer. The graph also shows the marginal revenue (MR) curve faced by this
firm.
Price per computer (Dollars)
$3500
$3000
$2500
$2000
$1500
$1000
$500
0
MR
MC..
ATC
Demand
10 20 30 40 50 60 70
Quantity of computers (number per year)
Chapter 15 Solutions
MICROECONOMICS
Ch. 15.1 - Prob. 1QCh. 15.1 - Prob. 2QCh. 15.1 - Prob. 3QCh. 15.1 - Prob. 4QCh. 15.1 - Prob. 5QCh. 15.1 - Prob. 6QCh. 15.1 - Prob. 7QCh. 15.1 - Prob. 8QCh. 15.1 - Prob. 9QCh. 15.1 - Prob. 10Q
Ch. 15 - Prob. 1QECh. 15 - Prob. 2QECh. 15 - Prob. 3QECh. 15 - Prob. 4QECh. 15 - Prob. 5QECh. 15 - Prob. 6QECh. 15 - Prob. 7QECh. 15 - Prob. 8QECh. 15 - Prob. 9QECh. 15 - Prob. 10QECh. 15 - Prob. 11QECh. 15 - Prob. 12QECh. 15 - Prob. 13QECh. 15 - Prob. 14QECh. 15 - Prob. 15QECh. 15 - Prob. 16QECh. 15 - Prob. 17QECh. 15 - Prob. 18QECh. 15 - Prob. 1QAPCh. 15 - Prob. 2QAPCh. 15 - Prob. 3QAPCh. 15 - Prob. 4QAPCh. 15 - Prob. 5QAPCh. 15 - Prob. 1IPCh. 15 - Prob. 2IPCh. 15 - Prob. 3IPCh. 15 - Prob. 4IPCh. 15 - Prob. 5IPCh. 15 - Prob. 6IPCh. 15 - Prob. 7IP
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- Why does Pinterest consider Google to be its largest competitor? Pinterest Pinterest places a premium on mobile platforms when developing new products and services.arrow_forwardsolve correctly. I will rate accordingly.arrow_forwardWhat are the economic benefits of perfect competition compared to a monopoly?arrow_forward
- What are the main differences between a perfectly competitive market and a monopoly.arrow_forwardWhat is the main issue in an monopoly Market. Is Google a monopoly?arrow_forwardIn 2015, Apple introduced the Apple Watch. Assume that the cost of producing the 38mm Apple Watch Sport was $73. The price was $363. What was Apple's price/marginal cost ratio? What was its Lerner Index? If Apple is a short-run profit-maximizing monopoly, what elasticity of demand did Apple believe it faced? Apple's price/marginal cost ratio was 4.97. (Enter your response rounded to two decimal places.) The value of Apple's Lerner Index (L) was 80. (Enter your response rounded to two decimal places.) Apple's elasticity of demand (e) is. (Enter your response rounded to two decimal places and include a minus sign.) Assume rice/marc t elasticity ter your re Assume tha pple's price/ dtv 13 MacBook Air 80 F9 F7 esc FS F3 F4 F1 F2 & @ #3 2$ 4 7 8. 1 2 W E Y U Q tab K A S F caps lock C shift fn control option command * 00 B >arrow_forward
- If I had an institution such as a college that holds the monopoly for providing meals on campus and they were to sell that monopoly access to a firm. What would the maximum a firm would pay for the right to sell their meals on campus? Would it be where MC=MR?arrow_forwardIf you were managing a monopoly, and small entrant tried to enter your market, explain why it might make sense to cut prices so low that you would suffer losses for a time.arrow_forwardAt one time, PLDT had a great deal of monopoly power and earned large profits. The growth in the use of cellular technology caused PLDT to lose money. What happened to PLDT's monopoly power?arrow_forward
- Is the insulin market considered as a monopoly? How and Why?arrow_forwardWhat defines monopoly? Explain in 200 wordsarrow_forwardA graph of a monopoly is shown. The initial position of the cost curves do not accurately represent their true relationship. First, move point E to indicate the monopoly's loss-minimizing price and quantity. Then, shift the average total cost (ATC) curve and average variable cost (AVC) curve to show the monopoly operating at a loss. Finally, position the loss box to indicate the monopoly's total loss. Price E MR ATC MC AVC D Lossarrow_forward
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