There will be a decline in the price and an increase in the output supplied by monopolist. This is because a unit subsidy will shift the marginal cost function down, thus, shifting the interaction point MR = MC to the right. This reduces the price and raises the quantity. However, the price fall is smaller than the subsidy because P > MR and fall in MC = fall in MR which implies fall in P will smaller.
Select option D.
please explain carefully The introduction of a unit subsidy for a mononoly facing a decreasing demand...
A certain production process generates both external costs and external benefits. The marginal private cost (NPC/and marginal external cost (MEC) functions are Increasing. while the marginal private benefit (MPB and marginal external benefit (MEBlfunctions are decreasing. The socially optimal (SO) as well as the individually rational (IR) output level are given by positive and finite numbers. When will the IR output level be higher than the SO one? provided that MEC SO-MEB SO b) provided that MEC SO MEB so...
please explain the answers step by step and show any curves possible For a pure monopolist the relationship between total revenue and marginal revenue is such that: A) marginal revenue is positive when total revenue is at a maximum. B) total revenue is positive when marginal revenue is increasing, but total revenue becomes negative when marginal revenue is decreasing. marginal revenue is positive when total revenue is increasing, but marginal revenue becomes negative when total revenue is decreasing. marginal revenue...
please help William A. McEachern - Chapter Titles ‘Introduction to Macroeconomics’, ‘Aggregate Expenditure and Aggregate Demand,’ & ‘Aggregate Supply’ Chapter ‘Introduction to Macroeconomics’ Q8. Why does a decrease of the aggregate demand curve result in less employment, given an aggregate supply curve? Q9. Is it possible for the price level to fall while production and employment both rise? If it is possible, how could this happen? If is is not possible, explain why not. P15. Determine whether each of the following...
The resulting decrease in the per-unit cost of production that comes from carefully decreasing output is known as economies of scale. Select one: True False A Canadian paper-products firm purchases raw materials from a U.S. logging firm just across the border. The U.S. dollar has been steadily appreciating against the Canadian dollar. The contract calls for payment to be made in U.S. dollars within 30 days. From the following list which is most likely for the Canadian firm? Select one:...
The table below presents the demand schedule and marginal costs facing a monopolist producer. TR ($) MR ($) MC($) Q 0 P($) 10 0 5 13 5 5 19 8 2 Instructions: Round your answers to the nearest whole number and include a negative sign if appropriate. Leave no cells blank. Enter O if appropriate. a. Fill in the total revenue and marginal revenue columns. b. What is the profit-maximizing level of output? units c. What price will the monopolist...
charterll from the sale of output input is known as The change in revenue that results from th by one additional unit of an input is ki a) Total physical product b) Profit c) Marginal physical product d) Marginal revenue product in the market where it sells its For a firm that is a price-taker in the market where it output, a) the menu of price-quantity combinations is given negatively-sloped demand curve for output. b) marginal is always less than...
Price Elasticity of Demand: AWAKE Price Elasticity of Demand measurers how changed in a price affect the quantity of the product demanded. Specifically, it is the ratio of the percentage change in quantity demanded to the percentage change in price. In order to understand how to plan a successful pricing program, marketers must understand how elastic or inelastic the consumers are to changes in price. In other words, to what extent will a price increase or decrease result in changes...
answer and explain E) 1/3 percent decrease in the quantity demanded for Good X. ........ Supply ..... 8. For the diagram to the right, calculate the value of price elasticity of supply over the price range from $15 to $25. A) 0.8 B) 0.2 C) 0.0533 D) 1.25 E) 5 F) 0.2667 G) 1.333 H) 0.75 I) none of the above 8 quantity 24 9. If at the current price, demand is elastic, then decreasing the price will A) Increase...
Price Elasticity of Demand: Chippers Cookie Bakery Price Elasticity of Demand measurers how changed in a price affect the quantity of the product demanded. Specifically, it is the ratio of the percentage change in quantity demanded to the percentage change in price. In order to understand how to plan a successful pricing program, marketers must understand how elastic or inelastic the consumers are to changes in price. In other words, to what extent will a price increase or decrease result...