a. Suppose Latte Larry’s successfully eliminates their rival Mocha Joe’s so that Latte Larry’s is now...
a. Suppose Latte Larry’s successfully eliminates their rival Mocha Joe’s so that Latte Larry’s is now a coffee monopolist. Let Latte Larry’s cost function be C(q) = 2q and the inverse demand for coffee be p(q) = 20 − 0.5q.
What is the profit-maximizing price that Larry will choose?
b. Suppose Latte Larry’s successfully eliminates their rival Mocha Joe’s so that Latte Larry’s is now a coffee monopolist. Let Latte Larry’s cost function be C(q) = 2q and the inverse demand for coffee be p(q) = 20 − 0.5q.
Using the profit-maximizing price you found in the previous question, calculate the deadweight loss in the market as a result of Larry's monopoly. You will certainly find it helpful to draw a diagram to assist in calculating this number.
I believe they are asking for the equilibrium price minus the answer I got in a for question b. Equilibrium is 18 - 11 so 7?
Homework Answers
Add Answer to:
a. Suppose Latte Larry’s successfully eliminates their rival
Mocha Joe’s so that Latte Larry’s is now...
QUESTION 18 Suppose Latte Larry’s successfully eliminates their rival Mocha Joe’s so that Latte Larry’s is...
QUESTION 18 Suppose Latte Larry’s successfully eliminates their rival Mocha Joe’s so that Latte Larry’s is now a coffee monopolist. Let Latte Larry’s cost function be C(q) = 2q and the inverse demand for coffee be p(q) = 20 − 0.5q. What is the profit-maximizing price that Larry will choose? I got P = 5 ?
Suppose Latte Larry's successfully eliminates their rival Mocha Joe's so that Latte Larry's is now a...
Suppose Latte Larry's successfully eliminates their rival Mocha Joe's so that Latte Larry's is now a coffee monopolist. Let Latte Larry's cost function be C(q) = 2q and the inverse demand for coffee be p(q) = 20 -0.49. Using the profit-maximizing price you found in the previous question, calculate the deadweight loss in the market as a result of Larry's monopoly. You will certainly find it helpful to draw a diagram to assist in calculating this number.
A single firm monopolizes the entire market for single-lever, ball-type faucets, which it can produce at...
A single firm monopolizes the entire market for single-lever, ball-type faucets, which it can produce at a cost of 20Q. Originally the firm faces an inverse market demand curve given by P=80-Q. Calculate the profit-maximizing price and quantity for the firm. Suppose that the market demand curve shifts outward and becomes steeper. Market demand is now described as P=100-2Q. What is the firm’s profit maximizing price and quantity now? What is the firm’s profit? Assume now that the market demand...
Suppose Healthy Hospital is a for-profit hospital operating with significant market power. The weekly inverse market...
Suppose Healthy Hospital is a for-profit hospital operating with significant market power. The weekly inverse market demand is P = 500 – 2Q where Q is the number of patient days and P is the price. The marginal and average costs are constant at $100 per patient day. a. Given this information, solve for the profit maximizing level of output for Healthy Hospital. b. What price will Healthy Hospital charge? c. What is the value of profits earned given your...
i just need the answer for "e". Problem 1 (4 points) Knope Industries is a firm...
i
just need the answer for "e".
Problem 1 (4 points) Knope Industries is a firm that produces miniature model souvenirs with total cost function TC(Q) = 2500 + 50Q +0.02Q2 (e) Sketch a graph with the demand curve, marginal revenue curve, and marginal cost curve, and label the profit-maximizing price and quantity. (1 pt) Problem 1 (4 points) Knope Industries is a firm that produces miniature model souvenirs with total cost function TCQ) = 2500+ 500+ 0.02Q (a) Write...
1. Suppose that a single-price monopolist faces the demand function P 100 Q where I is...
1. Suppose that a single-price monopolist faces the demand function P 100 Q where I is average weekly household income, and that the firm's marginal cost function is given by MC(Q) 2Q. The firm has no fixed costs. = (a) If the average weekly household income is $600, find the firm's marginal revenue function. (b) What is the firm's profit-maximizing quantity of output? At what price will the firm sell that output? What will the firm's marginal cost be? (c)...
Please so work so I can use as study reference. Thank you :) 5) Suppose the...
Please so work so I can use as study reference. Thank you
:)
5) Suppose the malket demand curve is Q- 10200-100p. The monopolist's cost finction is C(q) = 1000 + qi/2 a) Find the monopolist's marginal revenue and marginal cost functions MR b) Calculate the equilibrium monopolist price and quantity s) Sketch the monopoly's demand, marginal revenue, and marginal cost curves. Label the axes, the curves, the equilibrium, and the vertical intercepts of all curves. d) Calculate consumer surplus,...
3. The market illustrated below has inverse demand p(Q) = 130 - 3Q and industry-wide marginal...
3. The market illustrated below has inverse demand p(Q) = 130 - 3Q and industry-wide marginal cost MCQ) = 10 + 2Q. If production is competitive, this is the market (inverse) supply curve. If production is consolidated under a monopolist, this is the monopolist's MC curve. a. Suppose there is a monopolist. Explain how marginal revenue for a monopolist is different than for a firm under perfect competition. Then derive the profit-maximizing market outcome (including the monopoly price and quantity...
4. (25 points) Suppose there are only two firms producing widgets. The total cost function for ea...
4. (25 points) Suppose there are only two firms producing widgets. The total cost function for each firm is identical and is given by T℃(a = 8h, where gi is the output of firmi A market research company has found that demand for widgets can be described by the inverse demand function P 200 2Q, where Q-q (a) (10 points) A firm's action in the Courot Duopoly game is to choose an output level. Draw each firm's reaction function as...
Suppose Latte Larry's successfully eliminates their rival Mocha Joe's so that Latte Larry's is now a coffee monopolist. Let Latte Larry's cost function be C(q) = 2q and the inverse demand for coffee be p(q) = 20 -0.49. Using the profit-maximizing price you found in the previous question, calculate the deadweight loss in the market as a result of Larry's monopoly. You will certainly find it helpful to draw a diagram to assist in calculating this number.
Suppose Healthy Hospital is a for-profit hospital operating with significant market power. The weekly inverse market demand is P = 500 – 2Q where Q is the number of patient days and P is the price. The marginal and average costs are constant at $100 per patient day. a. Given this information, solve for the profit maximizing level of output for Healthy Hospital. b. What price will Healthy Hospital charge? c. What is the value of profits earned given your...
i
just need the answer for "e".
Problem 1 (4 points) Knope Industries is a firm that produces miniature model souvenirs with total cost function TC(Q) = 2500 + 50Q +0.02Q2 (e) Sketch a graph with the demand curve, marginal revenue curve, and marginal cost curve, and label the profit-maximizing price and quantity. (1 pt) Problem 1 (4 points) Knope Industries is a firm that produces miniature model souvenirs with total cost function TCQ) = 2500+ 500+ 0.02Q (a) Write...
1. Suppose that a single-price monopolist faces the demand function P 100 Q where I is average weekly household income, and that the firm's marginal cost function is given by MC(Q) 2Q. The firm has no fixed costs. = (a) If the average weekly household income is $600, find the firm's marginal revenue function. (b) What is the firm's profit-maximizing quantity of output? At what price will the firm sell that output? What will the firm's marginal cost be? (c)...
Please so work so I can use as study reference. Thank you
:)
5) Suppose the malket demand curve is Q- 10200-100p. The monopolist's cost finction is C(q) = 1000 + qi/2 a) Find the monopolist's marginal revenue and marginal cost functions MR b) Calculate the equilibrium monopolist price and quantity s) Sketch the monopoly's demand, marginal revenue, and marginal cost curves. Label the axes, the curves, the equilibrium, and the vertical intercepts of all curves. d) Calculate consumer surplus,...
3. The market illustrated below has inverse demand p(Q) = 130 - 3Q and industry-wide marginal cost MCQ) = 10 + 2Q. If production is competitive, this is the market (inverse) supply curve. If production is consolidated under a monopolist, this is the monopolist's MC curve. a. Suppose there is a monopolist. Explain how marginal revenue for a monopolist is different than for a firm under perfect competition. Then derive the profit-maximizing market outcome (including the monopoly price and quantity...
4. (25 points) Suppose there are only two firms producing widgets. The total cost function for each firm is identical and is given by T℃(a = 8h, where gi is the output of firmi A market research company has found that demand for widgets can be described by the inverse demand function P 200 2Q, where Q-q (a) (10 points) A firm's action in the Courot Duopoly game is to choose an output level. Draw each firm's reaction function as...
Most questions answered within 3 hours.
-
What is the communication style of Generation Z in the
workplace?
asked 1 minute from now -
1.) True or False... In the reaction of hydrogen gas with oxygen
gas to produce water,...
asked 4 minutes ago -
Discuss the basic elements of a computer program and how they
are put together. (Hint: If...
asked 5 minutes ago -
Analytically solve for the response y[t] of the system
h[t]=2e‐10t for a pulse input x[t] of...
asked 7 minutes ago -
problem 5.31
The rate of the reaction of methyl chloride with hydroxide ion is
linearly dependent...
asked 35 minutes ago -
A particle has
more than enough energy to eject an electron from a metal's
surface. What...
asked 33 minutes ago -
2a. A row of seats is parallel to a stage at a distance of 8.0 m...
asked 35 minutes ago -
When activitys duration are stochastic, the expected duration of
a path is equal to the sum...
asked 30 minutes ago -
The AICPA Code of Professional Conduct can be found online and
is organized in four sections....
asked 35 minutes ago -
Mr. H issues a 15 year mortgage of $325,000 at an annual
interest rate of 4.4%...
asked 26 minutes ago -
Exercise 2-17 (Part Level Submission) Erin Brushwood sells
gourmet chocolate chip cookies. The results of her...
asked 28 minutes ago -
Imagine you are the owner of a small, entrepreneurial start-up.
You feel stretched to the snapping...
asked 57 minutes ago