Suppose a monopolist has the demand function Q = 1000P^-3. Use the Lerner Index to find...
Suppose a monopolist has the demand function Q = 1000P^-3. Use the Lerner Index to find the monopolists optimal markup of price over marginal cost. Show all work!
Homework Answers
Add Answer to:
Suppose a monopolist has the demand function Q = 1000P^-3. Use
the Lerner Index to find...
1. (0 A monopolist with cost function e(Q)-jo* faces a consumer whose demand functions are given...
1. (0 A monopolist with cost function e(Q)-jo* faces a consumer whose demand functions are given by (a) [51 Suppose the monopolist cannot engage in any price discrimination. (b) [5) What is the deadweight loss (relative to the competitive market out (c) [5] Now, suppose price discrimination is possible. Find the monopolist's (d) [51 What information is required for the monopolist to be able to use Qi=20-P and Q-40-2P. Find the firm's optimal pricing strategy. Calculate the firm's Lerner index....
1. [20] A monopolist with cost function c(Q) = 2 faces a consumer whose demand functions...
1. [20] A monopolist with cost function c(Q) = 2 faces a consumer whose demand functions are given by. 01 20 P and Q2 40 2P. (a) 5] Suppose the monopolist cannot engage in any price discrimination. Find the firm's optimal pricing strategy. Calculate the firm's Lerner index. (b) 15) What is the deadweight loss (relative to the competitive market out- come) associated with this pricing strategy, if any? (c) 15) Now, suppose price discrimination is possible. Find the monopolist's...
Microeconomics [20] A monopolist with cost function c(Q) demand functions are given by. faces a consumer...
Microeconomics
[20] A monopolist with cost function c(Q) demand functions are given by. faces a consumer whose Q1=20-P and Q2-40-2P. (a) [5] Suppose the monopolist cannot engage in any price discrimination. Find the firm's optimal pricing strategy. Calculate the firm's Lerner index. come) associated with this pricing strategy, if any? optimal third-degree price-discrimination strategy. Which consumer is (b) [5] What is the deadweight loss (relative to the competitive market out- (c) [5] Now, suppose price discrimination is possible. Find the...
2. A monopolist has a cost function given by TC 250+q+.004q. The inverse market demand for...
2. A monopolist has a cost function given by TC 250+q+.004q. The inverse market demand for boxes is given by p 8-.0010. The monopolist is curranty able to exclude rivals from the market becaus of a spocial governmental zoning rule (a) What is its output and what price does it charge for boxes? (b) Calculate the firm's profit at this output level. (c) Calculate the firm's producer's surplus at this output level. (d) Calculate the consumer's surplus in this situation....
Consider a monopolist facing the demand curve p = 90 − 2q with cost function c(q) = 0.25q^2 . (a) Find the profit-maximi...
Consider a monopolist facing the demand curve p = 90 − 2q with cost function c(q) = 0.25q^2 . (a) Find the profit-maximizing quantity qm and price pm. What are the monopolist’s profits? (b) What is the value of the Lerner index at qm? (c) Find the efficient quantity and draw a graph depicting the deadweight loss under monopoly.
1. Suppose that a single-price monopolist faces the demand function P 100 Q where I is...
1. Suppose that a single-price monopolist faces the demand function P 100 Q where I is average weekly household income, and that the firm's marginal cost function is given by MC(Q) 2Q. The firm has no fixed costs. = (a) If the average weekly household income is $600, find the firm's marginal revenue function. (b) What is the firm's profit-maximizing quantity of output? At what price will the firm sell that output? What will the firm's marginal cost be? (c)...
A monopolist has discovered that the inverse demand function of a person with income M for...
A monopolist has discovered that the inverse demand function of a person with income M for the monopolists product is p = 2M −q. The monopolist has a total cost function, c(q) = 100q. The monopolist is able to observe the incomes of its consumers and to practice price discrimination according to income (second-degree price discrimination). (a) Draw the demand function of consumers with income ML and those with income MH, with ML < MH. [20%] (b) Determine the price...
6. A monopolist has discovered that the inverse demand function of a person with income M...
6. A monopolist has discovered that the inverse demand function of a person with income M for the monopolists product is p = 2M − q. The monopolist has a total cost function, c(q) = 100q. The monopolist is able to observe the incomes of its consumers and to practice price discrimination according to income (second-degree price discrimination). (a) Draw the demand function of consumers with income ML and those with income MH , with ML < MH . [20%]...
A monopolist has demand function Q(P)-ap-ε (with lel > 1) and total cost function TC(Q)-cQ (a)...
A monopolist has demand function Q(P)-ap-ε (with lel > 1) and total cost function TC(Q)-cQ (a) Show that the demand elasticity is -e (b) Find the firm's optimal price as a function of c and ε. (c) What happens to price as є ічі.e. є approaches 1 from the right side of the number line)? (d) What is the monopoly's profit-maximizing output?
The inverse demand function a monopoly faces is P = 100 − Q. The firm’s cost curve isTC(Q) = 10 +...
The inverse demand function a monopoly faces is P = 100 − Q. The firm’s cost curve isTC(Q) = 10 + 5Q (f) (4 points) For what value of fixed costs, does the monopolist break even? (g) (4 points) For what value of fixed costs, would be monopolist find it optimal to shut down in the short-run? (h) (4 points) For what value of fixed costs, would be monopolist find it optimal to shut down in the long-run? (i) (4...
1. (0 A monopolist with cost function e(Q)-jo* faces a consumer whose demand functions are given by (a) [51 Suppose the monopolist cannot engage in any price discrimination. (b) [5) What is the deadweight loss (relative to the competitive market out (c) [5] Now, suppose price discrimination is possible. Find the monopolist's (d) [51 What information is required for the monopolist to be able to use Qi=20-P and Q-40-2P. Find the firm's optimal pricing strategy. Calculate the firm's Lerner index....
1. [20] A monopolist with cost function c(Q) = 2 faces a consumer whose demand functions are given by. 01 20 P and Q2 40 2P. (a) 5] Suppose the monopolist cannot engage in any price discrimination. Find the firm's optimal pricing strategy. Calculate the firm's Lerner index. (b) 15) What is the deadweight loss (relative to the competitive market out- come) associated with this pricing strategy, if any? (c) 15) Now, suppose price discrimination is possible. Find the monopolist's...
Microeconomics
[20] A monopolist with cost function c(Q) demand functions are given by. faces a consumer whose Q1=20-P and Q2-40-2P. (a) [5] Suppose the monopolist cannot engage in any price discrimination. Find the firm's optimal pricing strategy. Calculate the firm's Lerner index. come) associated with this pricing strategy, if any? optimal third-degree price-discrimination strategy. Which consumer is (b) [5] What is the deadweight loss (relative to the competitive market out- (c) [5] Now, suppose price discrimination is possible. Find the...
2. A monopolist has a cost function given by TC 250+q+.004q. The inverse market demand for boxes is given by p 8-.0010. The monopolist is curranty able to exclude rivals from the market becaus of a spocial governmental zoning rule (a) What is its output and what price does it charge for boxes? (b) Calculate the firm's profit at this output level. (c) Calculate the firm's producer's surplus at this output level. (d) Calculate the consumer's surplus in this situation....
1. Suppose that a single-price monopolist faces the demand function P 100 Q where I is average weekly household income, and that the firm's marginal cost function is given by MC(Q) 2Q. The firm has no fixed costs. = (a) If the average weekly household income is $600, find the firm's marginal revenue function. (b) What is the firm's profit-maximizing quantity of output? At what price will the firm sell that output? What will the firm's marginal cost be? (c)...
A monopolist has demand function Q(P)-ap-ε (with lel > 1) and total cost function TC(Q)-cQ (a) Show that the demand elasticity is -e (b) Find the firm's optimal price as a function of c and ε. (c) What happens to price as є ічі.e. є approaches 1 from the right side of the number line)? (d) What is the monopoly's profit-maximizing output?
Most questions answered within 3 hours.
-
A
cylunder of titanium (length = 5.00cm, diameter = 1.20 cm) has a
mass of 25.5...
asked 1 hour ago -
1) Answer Each question with 1-2 Sentences:
a) How can we use the continuity and change...
asked 1 hour ago -
5. What is the decimal equivalent of the largest binary
integer that can be obtained with...
asked 1 hour ago -
Why is the magnitude of the Type Ia supernova always the same
(-19.6)?
asked 1 hour ago -
5. You are a quality control engineer and you are
asked to analyze the lifetime (in hours)...
asked 2 hours ago -
How many ways can 2 people be chosen and arranged in a straight
line if there...
asked 2 hours ago -
(Problem 1d). Leandro has 16 hours per day that he can allocate
to work or leisure....
asked 3 hours ago -
Morganton Company
makes one product and it provided the following information to help
prepare the master...
asked 4 hours ago -
2Al + 3Cl2 --> 2AlCl3
If one mole Al is reacted w two moles Cl2, how...
asked 4 hours ago -
1. You will see some trends in the movement of each currency vs.
the US Dollar....
asked 4 hours ago -
9. (9 pts) An investor with a stock portfolio worth several
hundred thousand dollars sued his...
asked 5 hours ago -
Which statement is true?
a. Unless directed otherwise, the computer automatically
executes C. statements one before...
asked 5 hours ago