There are several market structures within an economy that affect the decisions ofindividuals and firms.A) Describe the effect on price and the quantity available in the marketplace for amonopoly market structure.B) Explain one positive effect of a monopoly on individuals and firms.C) Explain one negative effect of a monopoly on individuals and firms.Your answers must be in complete sentences.

A) When compared to a competitive market, the influence on price and quantity accessible in the…

Answered: There are several market structures…

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter9: Market Structure And Long-run Equilibrium

Section: Chapter Questions

Problem 9.6IP

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How does the monopoly determine the level of output that maximizes profit? Group of answer choices By determining where marginal revenue is equal to marginal cost. A monopoly does not need to calculate where maximum profit occurs because they have no competition and can set any price they want for their product. By determining where total revenue equals marginal cost. By multiplying price by marginal cost.
Question 4 i. ii. iii. A monopoly can be recognized by certain characteristics that set it aside from the other market structures. Explain why a monopoly firm is a price-maker in microeconomics. The opponent of monopoly argued that the monopoly power will result to a social cost. Explain why. A perfectly competitive market has the opposite characteristics or conditions from the monopoly market, describe THREE (3) characteristics or conditions of the perfectly Competitive market structure.
What are the limitations of a monopoly? Provide ONE example of a policy we can use to address monopolies.
How are companies able to use the differences in culture to effectively market a product or service to specific groups of people ?
A natural monopoly is most likely to occur in which of the following industries? Group of answer choices a. the pharmaceutical industry because the development and approval of new drugs through the Food and Drug Administration can take more than 10 years b. the diamond mining and marketing industry because one firm can control a key resource c. the software industry because of the importance of network externalities d. an industry where fixed costs are very large relative to variable costs
Create a scenario in which a monopoly might form and analyze that monopoly situation. To do that, please complete the following: Describe your fictitious company and its product that it sells on the market. Explain the barrier that you have that makes this company a monopoly. 1. Draw and post a monopoly diagram for that company and show that company earning profits.
Give two examples of price discrimination. In each case, explain why the monopolist chooses to follow this business strategy. What are the three reasons that a market might have a monopoly? Give two examples of monopolies and explain the reason for each.
If you play a game of monopoly with your family/friends or electronically. How do you: Discuss why you believe the game is named Monopoly rather than Oligopoly Choose three of the following and explain how the game demonstrates the economics concepts as defined in the text. Capitalism Inflation Markets Prices Taxes Economies of scale “The invisible hand of the market” Government regulation
Does a monopolist have a supply curve? Explain your answer. What are the different types of price discrimination? Differentiate between an oligopoly and a monopolistic competition (i.e. number of firms and the degree of product differentiation). How are skilled and unskilled workers in an economy likely to be affected if the firms adopt skill-biased technologies?
Suppose a monopoly faces the market demand in the nearby figure. It has constant marginal cost equal to $6. Find the perfectly competitive quantity and price assuming the market is made up of producers each with marginal cost $6. Give a numeric answer for each and show them on the graph. What is the efficient quantity? Give a numeric answer and show it on the graph. Which market structure, monopoly or perfect competition, comes closer to achieving the efficient quantity? Now suppose there is a negative externality associated with producing the good of $5 per unit. Now which market structure, monopoly or perfect competition, comes closer to achieving the efficient quantity? Explain briefly.
With the aid of a diagram explain how a monopolist determines how much output to produce and what price to charge. AND Explain how the perfectly competitive firm decides whether to operate or shut down in the short run.
State whether the following statements are true or false, and explain why. a. Perfectly competitive firms have no control over the price they charge for their product. b. For a natural monopoly, average cost declines as the number of units produced increases over the relevant output range. c. An oligopolist has a larger than average portion of total market share without having to do any advertising.

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