With which of the following does the firm identify a key quantity by setting marginal cost...
Which of the following statements is correct regarding the Sweezy model of oligopoly? Competitors match price increases but do not match price decreases. The flatter portion of the demand curve corresponds to the quantity range where competitors match price changes. The firm faces more elastic demand when it lowers its price than when it raises its price. None of the statements listed is correct. The marginal revenue curve of the firm is horizontal. Question 22 1 pts Assume that the...
1. Consider a rent seeking environment involving a monopoly and consumers. The normal outcome is that the _______ willing to pay more to influence behavior, and the _______ usually successful in influencing government behavior. Group of answer choices monopoly is, consumers are consumers are, consumers are consumers are, the monopoly is monopoly is, monopoly is 2. Assume the inverse demand function for a Bertrand oligopoly is P = 500 – Q/5, and that the firm’s total cost function is TC...
1. A monopolist with marginal cost of production of 40 sells to two distinct consumers. For consumer 1, demand is given by Q1 = 300 - P1. For consumer 2, it is given by Q2 = 180 - P2. a. Determine the optimal uniform price and output when discrimination is impossible. b. Assume third-degree discrimination between the two consumers is possible. What price will be set for each consumer? What quantity will be sold for each consumer? c. How does...
Question 12 1 pts Suppose there are two types of consumers for cell phones and accessories (cases, extra chargers, etc.) Consumers of type A are willing to pay $750 for a phone and $40 for the accessories. Consumers of type B are willing to pay $720 for a phone and $90 for the accessories. The firm selling these products faces no competition and has a marginal cost of zero. What is the optimal commodity bundling strategy? charge $810 for a...
1) A perfectly competitive firm faces the following Total revenue, Total cost and Marginal cost functions: TR = 10Q TC = 2 + 2Q + Q2 MC = 2 + 2Q At the level of output maximizing profit , the above firm's level of economic profit is A) $0 B) $4 C) $6 D) $8 *Additional information after I did the math: The price this firm charges for its product is $10, the level of output maximizing profit is 4...
please answer all questions! Figure 15-6 Price $20+ Marginal Cost 100 150 200 Quantity Marginal Revenue Refer to Figure 15-6. What is the deadweight loss caused by a profit-maximizing monopoly? O O $150 $200 $250 Os300 A monopolist faces market demand given by P - 60 - Q. For this market, MR = 90 - 2Q and MC - Q. What price will the monopolist charge in order to maximize profits? O $20 O $30 O so Osso In Canada,...
Hints: In problem 11.7 the marginal cost is 20. For both problems it will be useful to know that for a linear demand curve, written with price as a function of quantity (P=0-bQ) marginal revenue is MR=a-2bQ. For problem 12.20, for some steps you will have to re-arrange the demand so to give price as a function of quantity rather than quantity as a function of price. Part a of 12.20 is the same as what we did in the...
8. Problems 2.8 Suppose that a firm has a marginal cost function given by MC(ą)1. Which of the following represent the firm's total cost function? (Hint: K is a constant of integration) Fixed costs are represented by As you may know from an earlier economics course, if a firm takes price (p) as given in its decisions then it will produce that output for which p = MC(q). Suppose the price is 15 p = 15 If the firm follows...
Figure 15-6 Price $20+ Marginal Cost 100 150 200 Quantity Marginal Revenue Refer to Figure 15-6. What is the deadweight loss caused by a profit-maximizing monopoly? O O $150 $200 $250 Os300 A monopolist faces market demand given by P - 60 - Q. For this market, MR = 90 - 2Q and MC - Q. What price will the monopolist charge in order to maximize profits? O $20 O $30 O so Osso In Canada, in the majority of...
hi i need answer from part d Question 2 (48 marks) Consider a firm which produces a good, y, using two factors of production, xi and x2 The firm's production function is Note that (4) is a special case of the production function in Question 1, in which α-1/2 and β-14. Consequently, any properties that the production function in Q1 has been shown to possess, must also be possessed by the production function defined in (4). The firm faces exogenously...