If this monopolistic firm's marginal cost is constant at $30, its profit maximizing output is: (Hint: Demand is linear (P-a-bQ) implying that the MR curve's slope is twice the demand curve slope; find the demand curve and then the MR curve.) Price $70 $50 $30 $10 10 20 30 40 50 60 70 Quantity 50 units. 40 units. 20 units. Demand 30 units.
Q: onopolistically competitive market. On the given graph, show Sleek's profit- aximizing output and…
A: A monopolistically competitive firm is a kind of market structure that combines elements of both…
Q: short run, we assume that capital is a fixed input and labor is a variable input, so the firm can…
A: A firm has following production function:where q is output; K is capital; L is labor.…
Q: A firm wishes to produce to Qunits of output using two inputs - ₁ and x2. The prices of the inputs…
A: Output to be produced = Q There are two inputs: x1 & x2 Therefore , Q = f(x1 ,x2 ) Price of x1…
Q: Assume the price of a hamburger is $2 and the price of a movie is $5, and the consumer's income is…
A: The optimum is at the point where the margjnal utility per dollar of the two good are equal.Marginal…
Q: Assume a starting position of macroeconomic equilibrium at the full-employment level of real GDP. In…
A: GDP refers to the total monetary value of all final goods and services that a nation produces in a…
Q: Imagine United Airlines deciding independently to reduce fares on its flights. Other competing…
A: A competitive game is a game in which the players have conflicting interests. A cooperative game is…
Q: QUESTION 20 for. A conclusion of the theory of rational expectations is that, in the short run, the…
A: The theory of rational expectations in economics posits that individuals incorporate all accessible…
Q: If the economy dips into a recession Question 14 options: automatic stabilizers will cause tax…
A: The employment of government revenue and expenditure measures to sway and stabilize an economy is…
Q: This figure shows the marginal cost and marginal revenue curves for Beautiful Cars. Which of the…
A: Marginal revenue is revenue gained by selling additional unit of good.Marginal cost is rise in cost…
Q: (Figure 1.9) The slope of the line between points L and M is: Multiple Choice O O O 0.67. 1.20.…
A: In economics, the term "slope" generally refers to the gradient or incline of a linear relationship…
Q: You've been hired as the manager of a monopoly that faces a demand curve described by P-178-Q. Your…
A: Demand curve faced by the monopoly firm: Total cost function: A monopoly firm always produces at MR…
Q: billion. In the second billion. Therefore, a lower MPC In the first economy (with MPC-0.5), the $30…
A: Multiplier: Multiplier tells if the autonomous expenditure increased by 1 unit, then by how many…
Q: rded Old Southwest Canning Co. has determined that any one of four sterilizing machines can be used…
A: MARR: 25 % per yearLife, n = 5 yearsThe rate of return analysis must be used as the basis for our…
Q: Aggregate saving (in billions SA 205 -100 -200 S 400 800 900 Aggregate income (in billions) Y
A: Keynesianism has made strides in its ability to solve economic downturns by government intervention,…
Q: When interest rates rise, what needs to happen in order for the present value of an asset to remain…
A: Interest rate : The percentage of the amount borrowed or invested, representing the cost of money or…
Q: of strawberries (per month) 1000 950 800 Oc950 O d. 50 550 B G C 2 3 4 Submarines (per month)…
A: PPF is the production possibility frontier.PPF shows the production possibility of two goods in an…
Q: (a) What was the rate of growth of real GDP from 2016 to 2017, and 2017 to 2018? (b) What was the…
A: The GDP growth rate, or Gross Domestic Product growth rate, is a key economic indicator that…
Q: Price (dollars) 10 8 6 4 2 D 0 100 200 300 400 500 600 Quantity Assume the demand curve intersects…
A: Consumer Surplus is the difference between the highest price a consumer is willing to pay and the…
Q: Many unions attempt to raise the hourly wages received by their members by restricting the supply of…
A: Labor union refers to a type of organization or association that usually depicts the common…
Q: Suppose the equilibrium price of milk is $3 per gallon but the federal government sets the market…
A: “Since you have posted multiple questions, we will provide the solution only to the first question…
Q: Answer the questions below based on the graph. What is the value of autonomous expenditures? What…
A: The consumption function is the function that shows the relationship between the consumption of a…
Q: Investment Goods B D C Consumption Goods E Figure 17.5 A movement from point C to point B in Figure…
A: Opportunity cost will be determined in the number of units of the second commodity forgone for one…
Q: A reduction in the tariff on imported steel would most likely benefit O a. the domestic consumers of…
A: Global trade is analogous to a global symphony, with countries trading products and services at…
Q: The marginal product of labor can be determined using the total product of labor curve. Using the…
A: The production function shows the relationship with the input used and output produced.There is…
Q: In the figure to the right, the importing country imposes a tariff that raises the domestic price…
A: It can be defined as a duty that is imposed by the central authority of the economy on the import…
Q: QUESTION 20. The term "business cycle" most closely refers to the O fluctuating profits of firms.…
A: The business cycle refers to the fluctuations in economic activities. Business cycle is also known…
Q: A market has a demand function given by the equation Qd = 180-2P, and a supply function is given by…
A: The equilibrium price and the quantity of a good sold in the market are determined by the forces of…
Q: Which of the following would likely cause a downward parallel shift in the AE curve and a leftward…
A: Keynesianism has made strides in its ability to solve economic downturns by government intervention,…
Q: Refer to the following table. What is the total cost of producing five (5) units of the good? Output…
A: From the table, the variable cost of production for 4 units is $425.The marginal cost of production…
Q: Determine the ESL, at i = 10% per year for equipment that has a first cost of $11,000 and the…
A: Operating costs are the expenses incurred to keep your business running on a daily basis. Operating…
Q: Use the following graph to answer the following questions. Line Y Price level (P) Line Z * B Line X1…
A: The aggregate demand curve shows the quantity of output that households, firms, the government, and…
Q: GDI = A , GDP = gross private domestic investment personal income A/ A " personal disposable income=
A: Calculate the GDI, GDP, Gross private domestic investment, personnal income, and personnal…
Q: The table provides data on a market demand schedule (top two rows) and a firm's average and marginal…
A: A shutdown point is the point where the marginal revenue of the firm becomes equal to the variable…
Q: On the following graph, use the green point (triangle symbol) to plot the weekly total revenue when…
A: Price elasticity measures how responsively demand for a good is to changes in price. By dividing the…
Q: A supermarket sells two brands of coffee: brand A at $p per pound and brand B at $q per pound. The…
A: Revenue is the total amount received when a good is soldRevenue is calculated by multiplying the…
Q: Eco Energy is a monopolistically competitive producer of a sports beverage called Power On. The…
A: A monopolistically competitive producer defines a firm that operates in a market characterized by a…
Q: 5. A C Where a group of potential attendees at an event is made up of one group who all want high…
A: Signaling:Signaling refers to actions or characteristics that convey information about an…
Q: Illustrate and fully discuss the derivation of the demand curve for a perfectly competitive firm
A: The perfectly competitive market refers to the market where many buyers and sellers exist in the…
Q: When the economy makes the transition from its short-run equilibrium to its long-run equilibrium,…
A: Macroeconomic equilibrium refers to a condition in the economy where the amount of goods and…
Q: The ation of the average annual growth rate of real GDP OA. is more complex when examining, data for…
A: The average annual growth rate of real GDP provides a measure that reflects the yearly growth, on…
Q: Which of the following movements would represent a decrease in the quantity supplied? P 9+ 8+ 7+ 6+…
A: The demand curve is the downward-sloping curve. The supply curve is the upward-sloping curve. The…
Q: Refer to Table 20-5. What value goes in blank (B)? O a 35 Ob 27 OC. 40 O d. 38
A: Total utility is the total satisfaction that the consumer derives from consumption of goods.Marginal…
Q: Suppose the U.S. Treasury issued $50 billion of short-term securities and sold them to the public.…
A: Treasury bonds are long-term debt securities issued by the government to raise funds, typically with…
Q: 4. Why does a firm in perfect competition produce the quantity at which marginal cost equals price?…
A: Perfect competition refers to a market structure where the abundance of buyers and sellers who owns…
Q: Workers with experience and skills sometimes lose their jobs and become unemployed due to changing…
A: Unemployment refers to the state at which a person is actively looking for a job but unable to get…
Q: The estimated negative cash flows for three design alternatives are shown below. The MARR is 13% per…
A: Cash flow:The sum of the total money is represented in the diagram. It represents the magnitude and…
Q: For an elastic demand function, the derivative of the revenue function with respect to price is:…
A: The revenue function is the product of price and quantity demanded, which is a function of price.…
Q: (14 of 15) Suppose that in 2015 your salary was 40,000, and the CPI was 175. Further suppose that in…
A: % increase in nominal salary between 2015 and 2016 = {[Salary (2016) - Salary (2015)] / Salary…
Q: In the closed nation of Zeeland, government spending exceeds net taxes. We would expect interest…
A: A government deficit is a situation where the government's expenditure will increase the revenue.…
Q: Where there are positive externalities from having a particular product in a society, the government…
A: Positive externality is the benefit enjoyed by society due to an economic activity in which they are…
Step by step
Solved in 3 steps with 2 images
- Please no written by hand solutions The total cost (TC) of a monopolistic firm is a linear function of output (q), expressed as TC=20q. Market demand for the firm is p=100-2q. a. Determine the monopolistic firm's profit-maximizing output and price. b. Calculate the Lerner Index of the firm. c. Determine the Pareto optimal level of output and price, where the sum of producer and the consumer surplus is maximal. d. Calculate the consumer surplus, producer surplus, and deadweight loss (DWL) in the monopoly case. e. Calculate the loss of consumer surplus and gain of producer surplus due to the monopoly.A monopolistically competitive firm faces the following demand curve for its product: Price ($) 10 6. 8. 17. 6. 3 2 1 Quantity 4 6. 8. 10 12 14 16 18 20 Refer to the Table. The firm has total fixed costs of $20 and a constant marginal cost of $9 per unit. How many units will the firm produce? "Don't leave spaces before, after or in between your number.A publisher has the following table of demand for the next novel by one of its famous authors: Price Number of novel in demand 100 0 90 1 80 2 70 3 60 4 50 5 40 6 30 7 20 8 10 9 0 10 The author is paid $2 to write the book (Fixed Cost or FC) and the marginal cost (MC) of publishing it is a constant $10 per book. a) Calculate the total revenue, total cost, and corresponding profits for each quantity. What quantity would a profit-maximizing publisher choose? What price would he set? b) Calculate marginal revenue. How does marginal revenue compare to price? Explain. c) Plot the marginal revenue (MR), marginal cost (MC), and demand (D) curves. At what quantity do the marginal revenue and marginal cost curves intersect? What does this mean? d) Obtain the economic profits (EP) of this monopolist and graph.
- The graph below shows cost and revenue curves for a monopolistically competitive firm. Price $2.00 $1.75 $1.50 $1.25 $1.00 $0.75 $0.50 $0.25 0 20 40 60 MR Quantity It will charge a price of $ ATC MC D 80 100 120 140 160 This monopolist's profit-maximizing output level is on the x-axis.] units. [Watch for the scaleThe following table shows the daily cost data and demand schedule for a typical firm producing board games in a monopolistically competitive market in the short run. Fill in the values in the Marginal Cost, Total Revenue, and Marginal Revenue columns in the following table and then answer the questions that follow. Quantity Price (Board games) (Dollars per game) Total Cost Marginal Cost (Dollars) (Dollars) Total Revenue (Dollars) Marginal Revenue (Dollars) Average Total Cost (Dollars) 1 16.00 14.00 10.00 8.00 6.00 4.00 2.00 2 3 4 5 6 7 8 0.50 12 18 21 24 35 48 63 80 Under monopolistic competition, a typical firm will produce Based on your calculations, the firm will Fill in the Average Total Cost column in the previous table. ^^^^^^^ board games at a price of $ Based on your calculations, the level of excess capacity in this monopolistically competitive market is per board game in the short run.Place the black point (plus symbol) on the graph to indicate the short-run profit-maximizing price and quantity for this monopolistically competitive company. Then, use the green rectangle (triangle symbols) to shade the area representing the company's profit or loss. 500 450 Monopolistically Competitive Outcome 400 350 ATC Profit or Loss 300 250 200 150 100 50 0 PRICE (Dollars per bike) MC MR Demand 400 0 50 100 450 500 150 200 250 300 350 QUANTITY (Bikes) Given the profit-maximizing choice of output and price, the shop is making shops in the industry relative to the long-run equilibrium. Now consider the long run in which bike manufacturers are free to enter and exit the market. profit, which means there are
- You're the manager of a firm that has constant marginal cost of $6. Fixed cost is zero. The market structure is monopolistically competitive. You're faced with the following demand curve: $12 10 Price 8 6 4 2 0 3 Demand 100 200 300 400 500 600 Quantity Show Transcribed Text a. Determine graphically the profit-maximizing price and output for your firm in the short run. Demonstrate what profit or loss you'll be making. (Please draw a graph) b. What happens in the long run?The below figure shows the demand and cost curves for a monopolistically competitive firm in the long run. The maximum economic profit this firm can make equal equals MC ATC 10 MR D. 12 16 20 24 Quantity funits per day) Price and costs (dollars per unitThe following table shows the daily cost data and demand schedule for a typical firm producing board games in a monopolistically competitive market in the short run. Fill in the values in the Marginal Cost, Total Revenue, and Marginal Revenue columns in the following table and then answer the questions that follow. Quantity Price Total Cost Marginal Cost Total Revenue Marginal Revenue Average Total Cost (Board games) (Dollars per game) (Dollars) (Dollars) (Dollars) (Dollars) (Dollars) 1 15.00 11 2 13.00 20 3 12.00 27 4 10.00 36 5 7.00 45 6 5.00 60 7 3.00 70 8 1.00 104 Under monopolistic competition, a typical firm will produce _______ board games at a price of $_____ per board game in the short run.
- Refer to Figure 1. If the market price is $2, what the firm will do? Enable Editing 4) Use the figure below to answer the following questions. Price and cost (dollars per unit) 80 MC 60 40 ATC 20 MR 20 40 60 80 100 Quantity (units per week) Figure 2 a) Refer to Figure 2 If this firm is in monopolistic competition, what is its output? b) Refer to Figure 2 If this firm is in monopolistic competition, what is the price it will charge? c) Refer to Figure 2. What is the firm profit situation? What time frame equilibrium is the firm? d) Refer to Figure 2. If this firm in monopolistic competition is in short-run equilibrium, and the firm making profit what will happen in the long run to the firm profit? explainExercise A.4. A company operating in a market of monopolistic competition has an inverse demand curve for its product: P=315-3q, where q is the number of units produced of the good and P its price. The total cost of production of this company is given by: TC(q)=q²+75q+4000. a) To maximize profits, how many units of the good should you sell? b) What price should I charge? (c) What benefits would it reap? (d) Given the above information, how much would you have to reduce fixed costs for longterm equilibrium to occur? Represent graphicallyQuestion 5: Jimmy has a room that overlooks, from some distance, a major league baseball stadium. He decides to rent a telescope for $50 a week and charge his friends and classmates to use it to peep at the game for 30 seconds. He can act as a monopolist for renting out "peeps". For each person who takes a 30 second peep, it costs Jimmy $.20 to clean the eyepiece. Jimmy believes he has the following demand for his service: Price of a Peep $1.20 Quantity of peeps demanded 1.00 90 100 150 200 250 300 70 60 50 350 40 30 400 450 20 10 500 550 a) For each price, calculate the total revenue from selling peeps and themarginal revenue per peep. Price Quantity TR MR $1.20 100 90 100 150 200 70 250 60 300 350 50 40 30 400 450 20 500 10 550 b) At what quantity will Jimmy's profit be maximized? What price will he charge? What will his total profit be? c) Jimmy's landlady complains about all the visitors coming into the building and tells Jimmy to stop selling peeps. Jimmy discovers, though, if he…