The graph shows the demand curve, marginal revenue curve, and marginal cost curve of Big Splash, Inc., a producer of wading pools in monopolistic competition. Draw a point at the firm's profit-maximizing price and quantity. Draw a vertical arrow that shows the firm's markup. Draw a shape that shows the firm's economic profit. Big Splash's markup is $a pool. Big Splash's excess capacity is Big Splash's economic profit is $ 360 340 320- 300- 280- 260 240- 220- Price and cost (dollars per pool) 200- 180- 160- 140- 120- 100- 80 60- 40+ 0 MC ATC D MR Q 10 20 30 40 50 60 70 80 Quantity (pools per week) >>> Draw only the objects specified in the question.

The graph shows the demand curve, marginal revenue curve, and marginal cost curve of Big Splash, Inc., a producer of wading pools in monopolistic competition. Draw a point at the firm's profit-maximizing price and quantity. Draw a vertical arrow that shows the firm's markup. Draw a shape that shows the firm's economic profit. Big Splash's markup is $a pool. Big Splash's excess capacity is Big Splash's economic profit is $ 360 340 320- 300- 280- 260 240- 220- Price and cost (dollars per pool) 200- 180- 160- 140- 120- 100- 80 60- 40+ 0 MC ATC D MR Q 10 20 30 40 50 60 70 80 Quantity (pools per week) >>> Draw only the objects specified in the question.

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter10: Monopolistic Competition And Oligopoly

Section: Chapter Questions

Problem 11PAE

See similar textbooks

Similar questions

The graph shows the demand curve, marginal revenue curve, and cost curves of Bob's Best Burgers, a firm in monopolistic competition. Draw an arrow at the profit-maximizing quantity to show the firm's markup. Because firms (of which Bob's is one) are expect firms to the burger market. we would ⒸA. breaking even; enter OB. incurring an economic loss; increase demand in ⒸC. making an economic profit; enter OD. incurring an economic loss; exit 6.50 5.00- 4.50- 4.00- 3.00 Price and cost (dollars per burr 2.50 MC 50 ATC D MR 100 150 Quantity burgers per day) >>> Draw only the objects specified in the question. ✔ 250 800
The graph shows the demand, marginal revenue, marginal cost, and average total cost curves of La Bella Pizza, a firm in monopolistic competition Draw a point at the firm's profit-maximizing price and quantity. Label it 1. Draw a point at minimum average total cost. Label it 2. Draw a vertical arrow that shows the firm's markup. Label it Markup. Draw a horizontal arrow that shows the firm's excess capacity. Label it Excess capacity. La Bella's markup is $ a pizza. La Bella's excess capacity is The market is in equilibrium because O A. short-run; the quantity produced is less than the efficient scale O B. long-run; economic profit is zero O C. long-run; the quantity produced is the quantity at which marginal cost equals marginal revenue O D. long-run; price exceeds marginal revenue pizzas. 16.00- 14.00- 12.00- 10.00- 8.00- 6.00+ 0 Price (dollars per pizza) Q MC Q 50 ATC D MR 100 150 200 Quantity (pizzas per day) >>> Draw only the objects specified in the question. 250
Mike's a firm in monopolistic competition, produces bikes. With no advertising, Mike's profit-maximizing output is 500 bikes a day and the price is $100 a bike. The graph shows Mike's demand curve, marginal revenue curve, marginal cost curve, and average total cost curve with no advertising Now all firms begin to advertise. With advertising, Mike's maximizes profit by producing more than 500 bikes a day and charging less than $100 a bike. How does advertising change Mike's markup and excess capacity? Mike's markup Mike's excess capacity when it advertises. when it advertises. A. is larger, does not change OB. does not change; does not change OC. does not change; is smaller OD. is larger, is larger OE. is smaller, is smaller 150- 75- 50- 25- 104 Price and coal tollas per bike) MC ATC WARR 100 200 300 400 500 600 700 800 900 10 Quantity (bikes per day)
The figure below depicts a monopolistically competitive firm operating in the short run. Label the diagram with the items listed to the right of the figure. You will have to decide whether the firm is making a profit or a loss. Profit Price 8 25 OF 50 QUESTIONS COMPLETED -> At ед MR MC Quantity D ATC C Loss Average total cost Profit- maximizing price Profit- maximizing output SUBMIT ANSWE
The accompanying graph depicts average total cost (ATC), marginal cost (MC), marginal revenue (M), and demand (D) facing a monopolistically competitive firm. 50 MC 45 Place point A at the firm's profit maximizing price and 40 quantity. 35 What is the firm's total cost? ATC 30 25 total cost: $ 20 15 What is the firm's total revenue? 10 total revenue: $ MR 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95100 Quantity What is the firm's total profit? profit: $ Price and Cost (S)
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
FIGURE 10-1 MC ATC AVC MR Quantity The profit-maximizing firm illustrated in Figure 10-1 operates in a monopolistically competitive industry. Which of the following best explains what happens in the long run? New firms enter the industry and the firm's marginal cost curve shifts up, which leads to a decrease in the firm's output. New firms want to enter the market but CANNOT since there are barriers to entry in monopolistic competition. The market supply curve shifts right, reducing the equilibrium market price. ONew firms enter the industry and the firm's demand curve shifts left and becomes more elastic. Price
The graph shows the cost curves, demand curve, and marginal revenue curve of a firm in monopolistic competition. If this firm is maximizing profits, the firm's markup is $ S ALECK 120- 100- 80- 60- 40- 20- 0 Price and cost (dollars per pair) 25 MR ATC D 50 100 125 150 175 200 225 Quantity (pairs of shoes per week) 75 100 12
Draw a diagram of the long-run equilibrium in a monopolistically competitive market. How is price related to average total cost? How is price related to average total cost? How is price related to marginal cost?
FIGURE 10-1 Price MC ATC AVC D MR Quantity The profit-maximizing firm illustrated in Figure 10-1 operates in a monopolistically competitive industry. Which of the following best explains what happens in the long run? New firms enter the industry and the firm's marginal cost curve shifts up, which leads to a decrease in the firm's O output. New firms want to enter the market but CANNOT since there are barriers to entry in monopolistic competition. The market supply curve shifts right, reducing the equilibrium market price. New firms enter the industry and the firm's demand curve shifts left and becomes more elastic.
The graph depicts a monopolistically competitive firm. Assuming the firm's ATC is ATC', the firm's current economic profit (per day) is_____, and its long-run economic profit is _____. Price and cost $40 30 23 20 10 0 $3,000; $0 $1,500; $0 $1,500; $2,500 $4,000; $3,000 MR 150 200 MC ATC ATC AR=D Quantity (per day)