final Econ graphs

The figure below shows the demand curve and the long run average cost curve for an electric company. This market is a natural monopoly because the long run average cost curve is U-shaped when producing large quantities, the long run average cost is greater than demand when producing small quantities, the demand is higher than long run average cost the demand curve intersects the long run average cost curve at a point where the long run average cost curve is downward sloping

the demand curve intersects the long run average cost curve at a point where the long run average cost curve is downward sloping

A monopolistic competitor has the following information about cost and demand. Quantity Price ($) Total Revenue ($) Marginal Revenue ($) Total Cost ($) Marginal Cost ($) Average Cost($) 0 15 0 15 175 — — 5 14 70 13 180 1 36 10 13 130 11 190 2 19 15 12 180 9 207 3.4 13.8 20 11 220 7 225 3.6 11.25 25 10 250 5 250 5 10 30 9 270 3 290 8 9.67 35 8 280 1 335 9 9.57 40 7 280 -1 385 10 9.63 45 6 270 -3 465 16 10.33 50 5 250 -5 565 20 11.3 If this industry was perfectly competitive, what price would the good sell for?

$9

The following figure shows the average cost curve, demand curve, and marginal revenue curve for a monopolist. After maximizing profits, what do the firm's costs equal? the area of rectangle ABGH the area of rectangle BDEG the area of rectangle ACFH the area of rectangle ADEH

the area of rectangle ABGH

A monopolistic competitor has the following information about cost and demand. Quantity Price ($) Total Revenue ($) Marginal Revenue ($) Total Cost ($) Marginal Cost ($) Average Cost($) 0 15 0 15 175 — — 5 14 70 13 180 1 36 10 13 130 11 190 2 19 15 12 180 9 207 3.4 13.8 20 11 220 7 225 3.6 11.25 25 10 250 5 250 5 10 30 9 270 3 290 8 9.67 35 8 280 1 335 9 9.57 40 7 280 -1 385 10 9.63 45 6 270 -3 465 16 10.33 50 5 250 -5 565 20 11.3 What will this firm's profits equal in the long run?

$0

A monopolistic competitor has the following information about cost and demand. Quantity Price ($) Total Revenue ($) Marginal Revenue ($) Total Cost ($) Marginal Cost ($) Average Cost($) 0 15 0 15 175 — — 5 14 70 13 180 1 36 10 13 130 11 190 2 19 15 12 180 9 207 3.4 13.8 20 11 220 7 225 3.6 11.25 25 10 250 5 250 5 10 30 9 270 3 290 8 9.67 35 8 280 1 335 9 9.57 40 7 280 -1 385 10 9.63 45 6 270 -3 465 16 10.33 50 5 250 -5 565 20 11.3 Then, in the long run equilibrium, the firm will sell this good at what price?

$10

The following table shows a monopolist's demand curve and cost information for the production of its good. What price will it charge? Quantity Price per Unit Total Cost 25 $5 $110 30 $10 $125 35 $14 $130 40 $15 $140 $13 $15 $11 $12

$15

JustMeInc. is the only provider of high speed internet in Tinytown. The firm charges their customers on an annual basis. Its cost and demand information are given below. Quantity (Millions of subscribers) Price ($ per subscriber) Total Cost (million $) 1 300 200 2 260 380 3 233.33 540 4 210 680 5 180 800 6 150 900 7 100 980 8 60 1040 An unregulated monopoly will have profits of $120 million $140 million $160 million $180 million

$160 million

A monopolistic competitor has the following information about cost and demand. Quantity Price ($) Total Revenue ($) Marginal Revenue ($) Total Cost ($) Marginal Cost ($) Average Cost($) 0 25 0 25 30 — — 2 24 48 23 35 2.5 17.5 4 23 92 21 45 5 11.25 6 22 132 19 60 7.5 10 8 21 168 17 77 8.5 9.63 10 20 200 15 100 11.5 10 12 19 228 13 126 13 10.5 14 18 252 11 165 19.5 11.79 16 17 272 9 210 22.5 13.13 18 16 288 7 260 25 14.44 20 15 300 5 320 30 16 If this industry was perfectly competitive, what price would the good sell for?

$19

Refer to the table below. This information reflects the demand curve and the average cost curve for a firm that is a natural monopoly. What will this firm's profits equal? Price Quantity Demanded LRAC $13 1 $10.50 $11 2 $9.75 $9 3 $9.50 $7 4 $9.625 $5 5 $10.30

$2.50

City Gas is a natural monopoly that supplies natural gas to a particular city. Its cost and demand information are given below. Quantity (Millions of therms) Price ($ per therm) Total Cost (million $) 1 48 35 2 44 64 3 38 90 4 30 113 5 20 133 6 8 150 The marginal cost of going from a production of 4 million therms to a production of 5 million therms is

$20 million

The following table shows a monopolist's demand curve and cost information for the production of its good. What price will it charge? Quantity Price per Unit Total Cost 1 40 $20 2 30 $25 3 25 $28 4 20 $34

$25

The following table shows the demand curve and cost information for a firm that is a monopoly. Price Quantity TC $30 0 $10,200 $26 1,000 $11,000 $22 2,000 $12,000 $18 3,000 $15,000 $14 4,000 $22,000 If they maximize their profits, what will their revenue equal?

$54,000

The information below sets out the estimated market revenue for the television manufacturing market is given in the table below. Firm Revenue (in millions of $) Hitachi 525 Philips/Magnavox 1,270 JVC 630 Matsushita/Panasonic 840 Mitsubishi 520 Samsung 650 Sharp 615 Sony 1,930 Toshiba 950 10 more firms 1,120 Based on this information, the four-firm concentration ratio is

$55.1

The table below shows the demand curve and cost information for a firm that is a monopoly. Price Quantity TC $1,000 0 $500 $800 5 $1,200 $600 10 $3,100 $400 15 $7,000 $200 20 $11,500 If they maximize their profits, what price will they charge?

$600

The following table shows the demand curve and cost information for a firm that is a monopoly. Price Quantity TC $30 0 $500 $25 50 $600 $20 100 $1,350 $15 150 $2,300 $10 200 $3,400 If they maximize their profits, what will their profits equal?

$650

The table below shows a monopolist's demand curve and cost information for the production of its good. What quantity will it produce? Quantity Price per Unit Total Cost 1,000 $5.00 $1,000 1,100 $4.50 $1,100 1,300 $2.50 $1,150 1,400 $2.00 $1,200 1,400 1,300 1,100 1,000

1,000

The information below sets out the estimated market revenue for the television manufacturing market. Firm Revenue (in millions of $) Hitachi 525 Philips/Magnavox 1,270 JVC 630 Matsushita/Panasonic 840 Mitsubishi 520 Samsung 650 Sharp 615 Sony 1,930 Toshiba 950 0 more firms 1,120 Based on this information, the Herfindahl-Hirschman Index is

1,074.04

The information below sets out the estimated market revenue for the television manufacturing market. Firm Revenue (in millions of $) Hitachi 525 Philips/Magnavox 1,270 JVC 630 Matsushita/Panasonic 840 Mitsubishi 520 Samsung 650 Sharp 615 Sony 1,930 Toshiba 950 10 more firms 1,120 Based on this information, the Herfindahl-Hirschman Index is

1,074.04

The information below sets out the estimated market shares for the cellular phone manufacturing market are given in the table below. Firm Market Share Nokia 36% Fujitsu 3% Kyocera 3% LG 6% Motorola 16% Samsung 6% Sanyo 4% Siemens 7% Sony Ericsson 11% Plus 8 more firms with 1% each If Samsung were to acquire Sanyo, the Herfindahl-Hirschman Index would be

1,884

The following table shows a monopolist's demand curve and cost information for the production of its good. What quantity will it produce? Quantity Price per Unit Total Cost 10 $10 $20 20 $8 $50 30 $6 $65 40 $4 $90 50 $2 $120 10 20 30 40

30

City Gas is a natural monopoly that supplies natural gas to a particular city. Its cost and demand information are given below. Quantity (Millions of therms) Price ($ per therm) Total Cost (million $) 1 48 35 2 44 64 3 38 90 4 30 113 5 20 133 6 8 150 An unregulated monopoly will produce million therms of natural gas and sell each therm for

3; $38

City Gas is a natural monopoly that supplies natural gas to a particular city. Its cost and demand information are given below. Quantity (Millions of therms) Price ($ per therm) Total Cost (million $) 1 48 35 2 44 64 3 38 90 4 30 113 5 20 133 6 8 150 An unregulated monopoly will produce million therms of natural gas and sell each therm for .

3; $38

Refer to the table below. The information pertains to the demand curve and the average cost curve for a natural monopoly firm. What will the price be in this market? Price Quantity Demanded LRAC 50 1 $10.00 35 2 $20.00 20 3 $24.00 5 4 $37.50 20 50 35 5

50

Refer to the table below. The information pertains to the demand curve and the average cost curve for a natural monopoly firm. What will the price be in this market? Price Quantity Demanded LRAC 50 1 $10.00 35 2 $20.00 20 3 $24.00 5 4 $37.50 20 50 35 5

50

The following table shows the demand curve and cost information for a firm that is a monopoly. Price Quantity TC $10 0 $500 $9 200 $1,000 $8 400 $1,600 $7 600 $2,500 $6 800 $4,000 What quantity should they produce to maximize their profits?

600 units

The information below sets out the estimated market shares for the cellular phone manufacturing market. Firm Market Share Nokia 36% Fujitsu 3% Kyocera 3% LG 6% Motorola 16% Samsung 6% Sanyo 4% Siemens 7% Sony Ericsson 11% Plus 8 more firms with 1% each Based on this information, the four-firm concentration ratio is

70

The information below sets out the estimated market shares for the cellular phone manufacturing market. Firm Market Share Nokia 36% Fujitsu 3% Kyocera 3% LG 6% Motorola 16% Samsung 6% Sanyo 4% Siemens 7% Sony Ericsson 11% Plus 8 more firms with 1% each If Samsung were to acquire Sanyo, the four-firm concentration ratio would be

73

Sam owns an antique store in Boston. Many of his competitors left the market, causing his perceived demand curve to change. The following 2 tables show his old and new perceived demand curves. Original Demand Curve Price Quantity TC $1,000 0 $3,000 $900 10 $3,300 $800 20 $4,500 $700 30 $7,000 $600 40 $12,000 New Demand Curve Price Quantity TC $1,100 0 $3,000 $1,000 10 $3,300 $900 20 $4,500 $800 30 $7,000 $700 40 $12,000 Assume Sam can only choose from the quantities of output given in the table. By how much will the quantity that he sells change as a result of his competitors leaving the market?

it will stay the same

The following figure shows the average cost curve, demand curve, and marginal revenue curve for a monopolist. After maximizing profits, what do the firm's profit's equal? the area of rectangle ABGH the area of rectangle BDEG the area of rectangle BCFG the area of rectangle ADEH

the area of rectangle BDEG