MICROECONOMICS (LL)-W/ACCESS >CUSTOM<
11th Edition
ISBN: 9781264207718
Author: Colander
Publisher: MCG CUSTOM
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Question
Chapter 16, Problem 7QE
To determine
The monopolist willing to spend to protect the market position.
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Question 4: The Baxter brothers - Bob, Bill, Ben and Brad – have just made a documentary movie about their basketball
team. They are thinking about making the movie available for download on the internet. They can act as a monopolist if
they choose to do so. Each time the movie is downloaded, their Internet Service Provider charges them a fee of $4. The
Baxter brothers are arguing about which price to charge the customer per download. Here is the demand schedule for
their film:
Quantity of Downloads
Denanded
Price of
Download
$10
4
6.
2
10
15
a) Calculate the total revenue and marginal revenue per download.
Price
Quantity
TR
MR
$10
6.
3
10
15
b) Bill is proud of the film and wants as many people as possible to download it. What price would he choose?
How many downloads would be sold?
c) Bob wants as much total revenue as possible. What price would he choose? How many downloads would be
sold?
d) Ben wants to maximize profits. What price would he choose? How many downloads would be sold?…
1. Which of the following companies most closely resembles a monopoly?
Walmart
Microsoft
Starbucks
McDonald's
Question Source: Chiang 4e - Economics Princip
39
36
近
Chapter 16 Solutions
MICROECONOMICS (LL)-W/ACCESS >CUSTOM<
Ch. 16.1 - Prob. 1QCh. 16.1 - Prob. 2QCh. 16.1 - Prob. 3QCh. 16.1 - Prob. 4QCh. 16.1 - Prob. 5QCh. 16.1 - Prob. 6QCh. 16.1 - Prob. 7QCh. 16.1 - Prob. 8QCh. 16.1 - Prob. 9QCh. 16.1 - Prob. 10Q
Ch. 16 - Prob. 1QECh. 16 - Prob. 2QECh. 16 - Prob. 3QECh. 16 - Prob. 4QECh. 16 - Prob. 5QECh. 16 - Prob. 6QECh. 16 - Prob. 7QECh. 16 - Prob. 8QECh. 16 - Prob. 9QECh. 16 - Prob. 10QECh. 16 - Prob. 11QECh. 16 - Prob. 12QECh. 16 - Prob. 1QAPCh. 16 - Prob. 2QAPCh. 16 - Prob. 3QAPCh. 16 - Prob. 4QAPCh. 16 - Prob. 5QAPCh. 16 - Prob. 6QAPCh. 16 - Prob. 1IPCh. 16 - Prob. 2IPCh. 16 - Prob. 3IPCh. 16 - Prob. 4IPCh. 16 - Prob. 5IPCh. 16 - Prob. 6IPCh. 16 - Prob. 7IPCh. 16 - Prob. 8IPCh. 16 - Prob. 9IPCh. 16 - Prob. 10IPCh. 16 - Prob. 11IP
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- Why does consumer surplus decline when monopolies are present?arrow_forwardThe following graph gives the demand (D) curve for 5G LTE services in the fictional town of Streamship Springs. The graph also shows the marginal 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 16 1 20 1 PRICE (Dollars per gigabyte of data) 2 ATC MC- Monopoly Outcome MR D 0 0 1 2 3 4 5 6 7 8 9 10 QUANTITY (Gigabytes of data) Which of the following statements are true about this natural monopoly? Check all that apply. The 5G LTE company is experiencing diseconomies 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. In order for a monopoly to exist in this case, the government must have intervened and created it. The 5G LTE company is experiencing economies of scale. True or…arrow_forwardThe following graph gives the demand (D) curve for 5G LTE services in the fictional town of Streamship Springs. The graph also shows the marginal 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. PRICE (Dollars per gigabyte of data) 20 18 16 14 12 10 4 2 0 0 1 2 4 True MR 3 5 7 QUANTITY (Gigabytes of data) O False 6 8 ATC MC 9 10 D + Monopoly Outcome Which of the following statements are true about this natural monopoly? Check all that apply. ? The 5G LTE company must own a scarce resource. 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 government…arrow_forward
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