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ECON 332 -Spring 2018 Name: Given the following information, answer the questions below: Op(P) = 100-2P...
Let demand for car batteries be such that Q = 100 − 2P. Assume constant marginal...
Let demand for car batteries be such that Q = 100 − 2P. Assume constant marginal costs of 15. Compute the equilibrium price, quantity, consumer surplus, producer surplus and if relevant deadweight loss for: i. A perfectly competitive firm ii. A monopoly iii. Two firms engaged in Cournot Competition. iv. Two firms engaged in Bertrand Competition
Suppose that market demand for a good is given by QD(P) = 10−P. The total cost...
Suppose that market demand for a good is given by
QD(P) = 10−P. The total cost of production is TC(Q) =
2Q2. Determine quantity QM and price
PM that a monopolist will choose in this market.
Calculate consumer surplus (CS), producer surplus (PS), and the
deadweight loss (DWL) resulting from the monopoly. Graphical
Solution would suffice!
1) (25 points) Suppose that market demand for a good is given by Q”(P) - 10-P. The total cost of production is TCQ) =...
Deadweight Loss Given the following information: Qs = 2P P = Qs/2 QD= 180 - 4P...
Deadweight Loss Given the following information: Qs = 2P P = Qs/2 QD= 180 - 4P P = (QD -180)/-4 AR = P = 45-.25Q TR = 45 - .25Q2 Hint: MC – supply curve MR = 45 - 5Q Qs = supply Qd = demand Using the above information, Graph and calculate the price-output solution under competitive market assumptions. How much is the consumer surplus producer surplus and total surplus? Calculate the price and the...
Problem 1 Deadweight Loss Given the following information: Qs = 2P P = Qs/2 QD= 180...
Problem 1 Deadweight Loss Given the following information: Qs = 2P P = Qs/2 QD= 180 - 4P P = (QD -180)/-4 AR = P = 45-.25Q TR = 45 - .25Q2 MR = 45 - .5Q Hint: MC – supply curve MR = 45 - 5Q Qs = supply Qd = demand A) Using the above information, 1) Graph and calculate the price-output solution under competitive market assumptions. 2) How much is the consumer surplus producer surplus and...
Suppose that a Monopolist's market demand is given by P a - Q, a>2, and that...
Suppose that a Monopolist's market demand is given by P a - Q, a>2, and that the a) Calculate the profit maximising monopoly price and quantity. b) Calculate the price and quantity that arise under perfect competition. [8 marks ] c) Calculate and compare Consumer and Producer Surplus both under monopoly [6 marks ] and perfect competition: what is the Deadweight loss due to Monopoly? Provide a graphical description of the two cases. [16 marks]
Examine the graph below, which belong to a monopolist, and then answer the questions that follow:...
Examine the graph below, which belong to a monopolist, and then answer the questions that follow: Price 250 170 150 110 90 MC Demand MR 100 125 175 200 a. What is the monopoly profit maximizing price and quantity? i. Price: ii. Quantity: b. What is the perfectly competitive price and quantity? i. Price: ii. Quantity: a. What is the monopoly profit maximizing price and quantity? i. Price: ii. Quantity: b. What is the perfectly competitive price and quantity? i....
1. You have the following information about a monopolist p = 60 − 2q (1) MR...
1. You have the following information about a monopolist p = 60 − 2q (1) MR = 60 − 4q (2) MC = 40 (3) where equation (1) is the demand curve, equation (2) is the marginal revenue function, and equation (3) is the marginal cost function, assumed to be constant here. (i). Under the perfect competition outcome, what would be the profit-maximizing level of output (qc) and price (pc)? (ii). Under the monopoly outcome, what would be the profit-maximizing...
Worksheet 7 1. Use the figure below to answer the following questions. P, MR, MC, ATC...
Worksheet 7 1. Use the figure below to answer the following questions. P, MR, MC, ATC $50 ATC MR 100 150 200 250 300 400 Quantity of output (per week) a. What quantity would they sell? What would be the price? b. What will be the profit of this monopoly? c. What will be the consumer surplus in this unregulated monopoly? d. Is this a natural monopoly? Why or why not? e. Suppose this firm was able to practice perfect...
part 2 questions M Micro Theory - HW4 Due: Nov 21st Part 1: Suppose that the...
part 2 questions
M Micro Theory - HW4 Due: Nov 21st Part 1: Suppose that the market demand curve is P=100-Q and the market supply curve is P=Q. 1. What is the competitive market equilibrium (CME) price and quantity? 2. What is the maximum amount of total surplus in this market? 3. What is consumer surplus, producer surplus, and total surplus at the CME? 4. If this market were dominated by a monopoly, what would be the resulting price and...
1. Answer the following questions: a. Why is the demand curve for a monopolist downward-sloping, while...
1. Answer the following questions:
a. Why is the demand curve for a monopolist downward-sloping,
while the demand curve for the perfectly competitive firm is
horizontal?
b. Suppose a perfectly competitive industry is suddenly
transformed to a monopoly industry. What will happen to price,
output, consumer and producer surplus, and deadweight loss?
c. If the wireless phone industry is dominated by four large
firms, each with 20% of market share, and 2 small firms, each with
10% market share, what...
Suppose that market demand for a good is given by
QD(P) = 10−P. The total cost of production is TC(Q) =
2Q2. Determine quantity QM and price
PM that a monopolist will choose in this market.
Calculate consumer surplus (CS), producer surplus (PS), and the
deadweight loss (DWL) resulting from the monopoly. Graphical
Solution would suffice!
1) (25 points) Suppose that market demand for a good is given by Q”(P) - 10-P. The total cost of production is TCQ) =...
Suppose that a Monopolist's market demand is given by P a - Q, a>2, and that the a) Calculate the profit maximising monopoly price and quantity. b) Calculate the price and quantity that arise under perfect competition. [8 marks ] c) Calculate and compare Consumer and Producer Surplus both under monopoly [6 marks ] and perfect competition: what is the Deadweight loss due to Monopoly? Provide a graphical description of the two cases. [16 marks]
Examine the graph below, which belong to a monopolist, and then answer the questions that follow: Price 250 170 150 110 90 MC Demand MR 100 125 175 200 a. What is the monopoly profit maximizing price and quantity? i. Price: ii. Quantity: b. What is the perfectly competitive price and quantity? i. Price: ii. Quantity: a. What is the monopoly profit maximizing price and quantity? i. Price: ii. Quantity: b. What is the perfectly competitive price and quantity? i....
Worksheet 7 1. Use the figure below to answer the following questions. P, MR, MC, ATC $50 ATC MR 100 150 200 250 300 400 Quantity of output (per week) a. What quantity would they sell? What would be the price? b. What will be the profit of this monopoly? c. What will be the consumer surplus in this unregulated monopoly? d. Is this a natural monopoly? Why or why not? e. Suppose this firm was able to practice perfect...
part 2 questions
M Micro Theory - HW4 Due: Nov 21st Part 1: Suppose that the market demand curve is P=100-Q and the market supply curve is P=Q. 1. What is the competitive market equilibrium (CME) price and quantity? 2. What is the maximum amount of total surplus in this market? 3. What is consumer surplus, producer surplus, and total surplus at the CME? 4. If this market were dominated by a monopoly, what would be the resulting price and...
1. Answer the following questions:
a. Why is the demand curve for a monopolist downward-sloping,
while the demand curve for the perfectly competitive firm is
horizontal?
b. Suppose a perfectly competitive industry is suddenly
transformed to a monopoly industry. What will happen to price,
output, consumer and producer surplus, and deadweight loss?
c. If the wireless phone industry is dominated by four large
firms, each with 20% of market share, and 2 small firms, each with
10% market share, what...
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