ECON HW 7
If the inverse demand curve a monopoly faces is p = 100 -2Q and MC is constant at 16, then profit maximization is achieved when the monopoly sets price equal to
58
The above figure shows the market for a particular good. If the market is controlled by a perfect-price-discriminating monopoly, producer surplus equals
A + B + C + D + E
The above figure shows the market for a particular good. If the market is controlled by a perfect-price-discriminating monopoly, social welfare equals
A + B + C + D + E
One different between a monopoly and a competitive firm is that
A monopoly faces a downward-slopping downward curve.
When the marginal revenue curve intersects the horizontal axis
Demand is unitary elastic
The more INELASTIC the demand curve, a monopoly will
Lose fewer sales as it raises its price
The above figure shows the demand and marginal cost curves for a monopoly. Under monopoly, consumer surplus equals
None of these.
If the inverse demand function for a monopoly's product is a p = a -bQ, then the firm's marginal revenue function is
a - 2bQ
As other firms enter a monopoly's market, the demand curve a monopoly faces
becomes more elastic
The above figure shows the demand and marginal cost curves for a monopoly. The deadweight loss of this monopoly equals
c + f
As other firms enter a monopoly's market, the monopoly's market power
declines
A monopoly that is maximizing profits operates in the ________ portion of the demand curve.
inelastic
The ability of a monopoly to change a price that exceeds marginal cost depends on the
price elasticity of demand
If a market is controlled by a perfect-price-discriminating monopoly then
there is no consumer surplus
The above figure shows the market for particular good. If the market is controlled by a perfect-price-discriminating monopoly, consumer surplus equals
zero
The above figure shows the market for a particular good. If the market is controlled by a perfect-price-discriminating monopoly, the deadweight loss equals
zero.
The monopolists marginal revenue curve
lies below the demand curve
The more ELASTIC the demand curve, a monopoly will
lose more sales as it raises its price
A monopoly maximizes profit by setting
marginal revenue equal to marginal cost