1. Show (graphically) how MC pricing can result in losses for the monopoly.
If price is set such that P=MC,then
TR=P*Q=15*8=120
TC=AC*Q=19*8=152
Since TC>TR,the monopoly is incurring losses from this approach.
1. Show (graphically) how MC pricing can result in losses for the monopoly.
3. (20 points) Consider the monopoly pricing problem involes a distributor and a manufac- turor (both are monopoly). The demand function is P-10-20 And the marginal cost of producing is MC-1, while the marginal cost of distribution is assmed to be zero a). (10 points) If two firms are separate, determine the optimal monopoly pricing of each firm. b). (10 points) If two firms merge into a single monopoly, determine the optimal pricing and compare the profit level with the...
Graphically show the effect on monopoly profit when the cost of production inputs rises. Make sure to note both new and original profit.
3. Graphically show the effect on monopoly profit when the cost of production inputs rises. Make sure to note both new and original profit
By adhering to the MR = MC rule, a single-price monopoly Question 8 Not yet answered Points out of P Flag question Select one: O a maximizes its profit, which may in some cases mean minimiring its losses. O b. will always have a normal profit. O c. will always have an above-zero profit. O d. is not earning as large a profit as it can by setting MR (MC-P). Previous page Next page MacBook Air
what are four common cost bases used in cost-plus pricing. How can they all result in the same price?
You are a consultant who is advising a monopoly on the optimal pricing strategy. Your analysis has yielded the following information. The marginal cost (MC) is $3. The demand equation is P = 90 - 3Q The total cost (TC)is given by 35 + 3Q The marginal revenue (MR) is given by 90 - 6Q Based on this information, answer the following questions. Show FULL calculations! (a) Following the concepts of profit maximization, what is the profit maximizing quantity for this...
1.Describe in details, what is pricing strategies, and explain with examples of how pricing strategies are useful for success of any firm, of any market structure. 2.The role of pricing in a monopoly a competitive market structure how it help the firm to maximize profit.
When a natural monopoly is regulated using a marginal cost pricing rule, what can you say about the firm's profit and the market's efficiency?
Given the following diagranm Monopoly IGRAPH Regular Monopoly Natural Monopoly Off Off Show Deadweight Loss Show Economic Profit/Loss ($) Price, Average/Marginal Cost 225 200 175 150 125-- 100 ATC MC-AVC 75 50 25 MR 0 20 4060 80 100 120 140 160 180 Quantity (units per month) PROFIT CALCULATIONS SETTINGS Reset $125.00 Market Price (Pmkt) Cost Structure LoeMarginal Revenue (MR) High Cost $50.00 Cost $95.00 Marginal Cost (MC) Quantity $7,500.00 $8,100.00 ($600.00) Revenue 120 40 Costs Quantity 60 Profit Instructions:...
1)Which of the following will result in the most deadweight loss? A.a natural monopoly regulated with average cost pricing B.a natural monopoly regulated with average variable cost pricing C.an unregulated natural monopoly D.a natural monopoly regulated with marginal cost pricing 2)A good or service or a resource is nonexcludable if A.it is not possible to prevent someone from benefiting from it. B.it is possible to prevent someone from enjoying its benefits. C.its use by one person decreases the quantity available...