Homework Answers
Ans) Monopoly is when ghere is single seller selling unique product. Monopoly can be formed due to ÷
- Economies of scale.
- Government created.
- Possession of key resources.
Monopoly formed due to economies of scale is known as natural monopoly. In natural monopoly, it is best to have single seller. As only single seller can provide goods at low prices. Eg- water supply.
Economies of scale means decreasing average total cost due to large scale production. This decreasing cost gives advantage to firm over the potential competitors.
Option b.
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Unanswered Natural Monopoly Which of the following is NOT true? A natural monopoly occurs whenever the...
Predatory Pricing Which of the followings is not the purpose of predatory pricing? A To drive...
Predatory Pricing Which of the followings is not the purpose of predatory pricing? A To drive competitors out of a market B To prevent entry by potential rivals C To increase its own market power O D to increase output and lower prices Economies and Diseconomies of Scale When a firm gets so large that coordination and management of workers and other inputs becomes costly and difficult, it is experiencing which of the following? O A Diseconomies of scale O...
Consider the local telephone company, a natural monopoly. The following graph shows the demand curve for...
Consider the local telephone company, a natural monopoly. The following graph shows the demand curve for phone services, the company's marginal revenue curve (labeled MR), Its marginal cost curve (labeled MC), and its average total cost curve (labeled ATC). You can hover over the points on the graph to see their exact coordinates. PRICE (Dollars per month) 200 180 ATC 160 140 120 100 Demand 80 60 40 MC 20 MR - 0 6 12 18 24 30 36 42...
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a) In a monopoly, the profit maximizing quantity occurs where [choose] ["marginal cost", "average cost", "total cost", "variable cost"] equals [choose] ["marginal revenue", "the minimum possible value", "zero", "average cost"] . b) The existence of [choose] ...
9. Regulating a natural monopoly Consider the local cable company, a natural monopoly
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In the graph below for City Gas, which is a natural monopoly, there are a variety...
In the graph below for City Gas, which is a natural monopoly, there are a variety of curves which represent the long run position. A blue curve showing demand, a purple curve showing average cost, a red curve showing marginal cost, and a light green curve showing marginal revenue. As it relates to the marginal revenue curve, what can you tell about the natural monopoly position of City Gas and its marginal revenue situation? City Gas-A Natural Monopoly 8 Demand...
12) Your local water company is a considered A) a natural monopoly and will be regulated....
12) Your local water company is a considered A) a natural monopoly and will be regulated. B) an oligopoly and will be able to charge a price greater than marginal cost. C) monopoly and will not be able to charge a price greater than marginal revenue. D) perfect competition because everyone needs tap water. E) monopolistic competition and will be able to charge a price greater than marginal cost. 13) A barrier to entry is A) the economic term for...
Which of the following best describes the condition that leads to a natural monopoly? The firm takes anti-compe...
Which of the following best describes the condition that leads to a natural monopoly? The firm takes anti-competitive actions to keep other firms out. Economies of scale are large relative to quantity demanded in a market. The government prohibits entry into an industry A single firm controls an industry because there are very few customers in the industry occurs when the price of a good changes and consumers have an incentive to consume less of the good with a higher...
A monopoly is the single supplier of a product with no a. barriers to entry b....
A monopoly is the single supplier of a product with no a. barriers to entry b. close substitutes c. established price d. limit to supply over the relevant range of output with declining average total costs. In a natural monopoly, a firm has a. illegal barriers b.twenty-year patents c. pure competition d. economies of scale How does the demand curve for a product in a pure monopoly compare to the demand curve for the industry? a. They are the same....
please make sure you answer all the questions, thank you 9. Regulating a natural monopoly Consider...
please make sure you answer all the questions, thank you
9. Regulating a natural monopoly Consider the local telephone company, a natural monopoly. The following araph shows the monthly demand curve for phone services and the company's marginal revenue (MR), marginal cost (MC), and average total cost (ATC) curves 100 90 80 70 60 50 40 ATC MO 30 20 10 MRI I 20 16 18 4 6 810 12 14 2 QUANTITY (Thousands of subscriptions) PRICE (Dollars per sub...
4. For a monopoly firm, marginal revenue (MR) is price (greater/less) than 5. To maximize profits,...
4. For a monopoly firm, marginal revenue (MR) is price (greater/less) than 5. To maximize profits, a monopoly firm picks the quantity at which revenue average revenue) equals {marginal cost/average cost) (marginal (Game Theory/Consumer Theory) is a method for analyzing strategic behavior of oligopoly firms 7. The entry of the second firm under monopolistic competition structure of market shifts the demand curve of the first firm to the (right left). D Focus ch De 9 W 11. Firms in a...
Predatory Pricing Which of the followings is not the purpose of predatory pricing? A To drive competitors out of a market B To prevent entry by potential rivals C To increase its own market power O D to increase output and lower prices Economies and Diseconomies of Scale When a firm gets so large that coordination and management of workers and other inputs becomes costly and difficult, it is experiencing which of the following? O A Diseconomies of scale O...
Consider the local telephone company, a natural monopoly. The following graph shows the demand curve for phone services, the company's marginal revenue curve (labeled MR), Its marginal cost curve (labeled MC), and its average total cost curve (labeled ATC). You can hover over the points on the graph to see their exact coordinates. PRICE (Dollars per month) 200 180 ATC 160 140 120 100 Demand 80 60 40 MC 20 MR - 0 6 12 18 24 30 36 42...
In the graph below for City Gas, which is a natural monopoly, there are a variety of curves which represent the long run position. A blue curve showing demand, a purple curve showing average cost, a red curve showing marginal cost, and a light green curve showing marginal revenue. As it relates to the marginal revenue curve, what can you tell about the natural monopoly position of City Gas and its marginal revenue situation? City Gas-A Natural Monopoly 8 Demand...
Which of the following best describes the condition that leads to a natural monopoly? The firm takes anti-competitive actions to keep other firms out. Economies of scale are large relative to quantity demanded in a market. The government prohibits entry into an industry A single firm controls an industry because there are very few customers in the industry occurs when the price of a good changes and consumers have an incentive to consume less of the good with a higher...
A monopoly is the single supplier of a product with no a. barriers to entry b. close substitutes c. established price d. limit to supply over the relevant range of output with declining average total costs. In a natural monopoly, a firm has a. illegal barriers b.twenty-year patents c. pure competition d. economies of scale How does the demand curve for a product in a pure monopoly compare to the demand curve for the industry? a. They are the same....
please make sure you answer all the questions, thank you
9. Regulating a natural monopoly Consider the local telephone company, a natural monopoly. The following araph shows the monthly demand curve for phone services and the company's marginal revenue (MR), marginal cost (MC), and average total cost (ATC) curves 100 90 80 70 60 50 40 ATC MO 30 20 10 MRI I 20 16 18 4 6 810 12 14 2 QUANTITY (Thousands of subscriptions) PRICE (Dollars per sub...
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