Q. If a firm sells its output on a market that is characterized by many sellers and buyers, a differentiated product, and unlimited long-run resource mobility, then the firm is a. a monopolist. an oligopolist. a perfect competitor. a monopolistic competitor.
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Select correct answer and explain
Q. If a firm sells its output on a market that is characterized by many sellers and buyers, a differentiated product, and unlimited long-run resource mobility, then the firm is
- a. a monopolist.
- an oligopolist.
- a perfect competitor.
- a monopolistic competitor.
Q. explain is the statement true or false.
- in a short run monopolist will shut down when
average variable cost is greater than price at all outputs?
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- A. To maximize profits, every firm should operate at theminimum point of its average total cost curves. Is thisstatement true or false? Explain.B. The demand for a monopolistically competitive firm'sproduct is generally more elastic than that for amonopolist's product? Is this statement true or false?Explain. PLEASE ANSWER A AND BA firm is operating in the United States with only two other competitors in the industry. a. It is likely this industry would be characterized as: multiple choice 1 perfectly competitive. pure monopoly. monopolistically competitive. oligopoly. b. Firms in this industry will likely earn: multiple choice 2 an economic loss. an economic profit. a normal profit. c. If foreign firms begin supplying the product, increasing the number of competitors, it is likely that: multiple choice 3 economic profits will increase. economic losses will become smaller. economic profits will fall. normal profits will increase.A perfectly competitive firm is onsidered to be more generous in terms of price and quantity of output in comparison to firm belonged to monopoly and monopolistic markets. C. If firms incurring loss in this market begin to exit the market, what will happen to the market equilibrium? Demonstrate your answer using a simplified graph. d. The firm wishes to supply output more than the quantity determined under the equilibrium condition, is it worth to pursue?
- 3. A monopolist who is the exclusive producer of cricket bats in the UK faces a demand curve defined by P = 100 – 2Q and a short-run total cost curve of TC = 300 + 20Q. a. Given the above information, compute total revenue, marginal revenue, and marginal cost for this producer, and identify the optimal quantity, the optimal profit, and the equilibrium price. [10 marks] b. Considering the information from your answer to bullet point a., represent the monopoly market structure graphically. [5 marks]Monopolistic Competition.. A market with monopolistic competition is the second-most competitive market type. It is characterized by a large number of sellers and few barriers to entry or exit. Competition occurs in the form of product differentiation. By branding, firms hope to convince buyers of the uniqueness of their products. Advertising and packaging are essential to branding. In perfect competition, perfect information is freely and easily available to everyone; by contrast, in monopolistic competition, firms must rely on some amount of consumer ignorance in order for their advertising to be effective. The aim of product differentiation is not merely to make a one- time sale. Firms want consumers to develop brand loyalty. If a consumer believes that a particular brand is superior, then she will be unlikely to consider other suppliers' products as substitutes. With fewer substitutes available, demand becomes price inelastic. If a firm can successfully differentiate its product,…Question 1a. With the aid of a diagram explain how a monopolist determines how muchoutput to produce and what price to charge. [4 marks]b. Explain how the perfectly competitive firm decides whether to operate or shutdown in the short run. [4 marks]c. Explain why firms operating in monopolistically competitive markets probablywill not earn an economic profit in the long run. [4 marks]d. Why does interdependence of firms play a major role in oligopoly but not inperfect competition or monopolistic competition? [4 marks]
- Question Three A. A Monopolist producing and supplying cooking gas to Mombasa city faces the demand function. Q= 8800 – 20P. Its cost function is given by TC = 20Q + 0.05Q2 .i. Determine the quantity of cooking gas she will produce and the price she will charge to maximize profits and determine her profit. ii. Explain how her profits will be affected if regulators forced her to operate like a perfectly competitive firm. iii. Illustrate and compute deadweight loss and lost consumer surplus associated with her Monopoly operations. B. Kenya's minimum wage is Kshs 850 per hour. Imagine you are a policy maker and you must vote whether it be raised, lowered, or abolished. What will you decide? Why? Show how your decision will look when graphed.3 of 5 > O Macmillan Learning Monopolistic Competition and Product Differentiation-End of Chapter Problem Consider the statement: "In both the short run and in the long run, the typical firm in monopolistic competition and a monopolist each make a profit." a. Is the statement correct with respect to the short run; why or why not? Incorrect. A monopolist will earn positive profits in the short run, whereas a monopolistic competitor will not earn positive profits in the short run. Correct. Both a monopolistic competitor and a monopolist will earn positive profits in the short run. Incorrect. A monopolist may or may not earn positive profits in the short run, whereas a monopolistic competitor will earn positive profits in the short run. Incorrect. A monopolist will not earn positive profits in the short run, whereas a monopolistic competitor will earn positive profits in the short run. Incorrect. A monopolist will earn positive profiis in the short run, whereas a monopolistic competitor…Q99 A major difference between monopoly and perfect competition is that... a. Monopolistic firms tend to maximise revenue while perfectly competitive firms maximise profit. b. Perfectly competitive firms cannot maintain positive economic profits in the long run, whereas monopolists can. c. Monopolistic firms emphasise cost minimisation whereas perfectly competitive firms emphasise profit maximisation. d. Monopolists do not consider consumer demand when choosing price and output levels. e. Perfectly competitive firms can never earn economic profits; monopolistic firms always earn economic profits.
- Please no written by hand solutions The total cost (TC) of a monopolistic firm is a linear function of output (q), expressed as TC=20q. Market demand for the firm is p=100-2q. a. Determine the monopolistic firm's profit-maximizing output and price. b. Calculate the Lerner Index of the firm. c. Determine the Pareto optimal level of output and price, where the sum of producer and the consumer surplus is maximal. d. Calculate the consumer surplus, producer surplus, and deadweight loss (DWL) in the monopoly case. e. Calculate the loss of consumer surplus and gain of producer surplus due to the monopoly.hey how are you a)Draw the cost curves for a typical firm. Explain how a competitive firm chooses the level of output that maximizes profit. At that level of output, show on your graph the firm’s total revenue and total cost. b)Draw the demand curve, marginal revenue curve, average total cost curve, and marginal-cost curve for a monopolist. Show the profit-maximizing level of output, the profit-maximizing price, and the amount of profit. c)Why the demand curve for a firm operating in monopolistic competition is more elastic compared to the firm operating as a monopoly.2) The Epson Company is a monopolist in the market and faces the demand curve shown in the figure below. The firm's marginal cost curve is MC= 100 +2Q. a. What is the firm's profit-maximizing output and price? Price ($/unit) 400 0 D 200 Quantity of printers (thousand) b. If the firm's demand changes to P = 300 - Q while its marginal cost curve remains the same, what is the firm's profit-maximizing level of output and price? How does this compare to your answer for (a)? c. Draw a diagram showing these two outcomes. Holding marginal cost equal, how does the shape of the demand curve affect the firm's ability to charge a high price? (bonus question 5 points)
