Question

Assume that one of the hot dog vendors successfully lobbies the city council to obtain the exclusive right to sell hot dogs within the city limits. This firm buys up all the rest of the hot dog vendors in the city and operates as a monopoly. Assume that this change doesn't affect demand and that the new monopoly's marginal-cost curve corresponds exactly to the supply curve on the previous graph. Under this assumption, the following graph shows the demand (D), marginal-revenue (MR), and marginal-cost (MC) curves for the monopoly firm. Place the black point (plus symbol) on the following graph to indicate the profit-maximizing price and quantity of a monopolist. Monopoly Monopoly Outcome Deadweight Loss PRICE (Dollars per hot dog) 0 10 20 80 90 100 30 40 50 60 70 QUANTITY (Hot dogs) Consider the welfare effects when the industry operates under a competitive market versus a monopoly.

Answer 1

Compellive Marko Sama 3.5 monopoly 4.OFF A Ouantity 3.5 30 Compeblive Monopoly 4.0 20 Given the markt . Summary ......... - Compettive competitive packt