Chapter 15, 16, 17 Test
Based upon the information shown how many units will bearclaws produce to maximize profits
70, this is where mr=mc and down
the diagram depicts the market situation for a monopoly pastry shop called Bearclaws. given that Bearclaws chooses the profit maximizing price and quantity, what profit level will it obtain?
$280
A profit-maximizing monopoly's total revenue is equal to
P5 × Q3.
Monopolies are socially efficient because the price they charge is
above marginal cost
A monopoly can earn positive profits because it
can maintain a price such that total revenues will exceed total costs
Price discrimination adds to social welfare in the form of
increased total surplus
Vincent operates a scenic tour business in Boston. He has one bus that can fit 50 people per tour and each tour lasts 2 hours. His total cost of operating one tour is fixed at $450. Vincent's cost is not reduced if he runs a tour with a partially full bus. While his cost is the same for all tours, Vincent charges each passenger his/her willingness to pay: adults $18 per trip, children $10 per trip, and senior citizens $12 per trip. At those rates, on a typical day Vincent's demand is: Passenger Type Willingness to Pay (Dollars per unit) Quantity Demanded (Units) Adult1870Children1025Senior Citizens1255 Assume that Vincent's customers are always available for the tour; therefore, he can fill his bus for each tour as long as there is sufficient total demand for the day. Refer to Scenario 15-2. What is Vincent's profit on a typical day?
$820
Based upon the information shown, what is total revenue for Bearclaws, given that it maximizes profits?
$980
What area measures the monopolist's profit?
(K-B)*W
Based upon the information shown what price will bearclaws charge to maximize profits?
14.00
The demand curve for monopoly firm is depicted by curve
B
What is the socially efficient price and quantity for this natural monopolist?
H and l
What price will the monopolist charge in order to maximize profit?
K
What is the socially efficient price and quantity?
Price = B; quantity = Y
Bob's Butcher Shop is the only place within 100 miles that sells bison burgers. Assuming that Bob is a monopolist and maximizing his profit, which of the following statements is true?
The price of Bob's bison burgers will exceed Bob's marginal cost.
Which of the following is an example of public ownership of a monopoly?
US Postal Service
How much output will the monopolist produce in order to maximize profit?
W
Monopolies are socially efficient because the price they charge is
above the marginal cost
The fundamental source of monopoly power is
barriers to entry
A benefit to society of the patent and copyright laws is that those laws
encourage creative actvity
The deadweight loss associated with a monopoly occurs because the monopolist
produces an output level less than the socially optimal level.
price discrimination is the business practice of
selling the same good at different prices to different customers
one problem with government operation of monopolies is that
the government typically has little incentive to reduce costs
What is the area of deadweight loss?
the triangle 1/2[(A-C)*(Y-X)]
What is the monopoly price and quantity?
where mr=mc you go up to the demand and price is to the left and quantity is right down. Price=A quantity= x
