8. Natural monopoly analysis The following graph gives the demand (D) curve for 5G LTE services in the fictional town of Streamship Springs. The graph also shows the marginal revenue (MR) curve, the marginal cost (MC) curve, and the average total cost (ATC) curve for the local 5G LTE company, a natural monopolist. On the following graph, use the black point (plus symbol) to indicate the profit-maximizing price and quantity for this natural monopolist. PRICE (Dollars per gigabyte of data) 20 18 16 14 12 10 8 6 4 2 0 0 1 + 2 MR 3 5 7 QUANTITY (Gigabytes of data) 4 O True O False 6 8 ATC MC + 9 10 D Monopoly Outcome (?) Which of the following statements are true about this natural monopoly? Check all that apply. The 5G LTE company must own a scarce resource. It is more efficient on the cost side for one producer to exist in this market rather than a large number of producers. In order for a monopoly to exist in this case, the government must have intervened and created it. The 5G LTE company is experiencing economies of scale. True or False: Without government regulation, natural monopolies always earn zero profit in the long run.

The table below shows cost data for producing different amounts of cars. Suppose this market is a monopoly. Use the information in the table to find the output where the monopoly would maximize profit. Profit maximizing quantity: Price ($) Quantity Total Revenue ($) Total Cost ($) 150 0 0 60 120 3 360 108 100 600 240 90 810 405 80 960 672 70 1050 1050 What is the profit the monopoly achieved? $ 9 12 15 A ▶

8. Natural monopoly analysis The following graph gives the demand (D) curve for satellite TV services in the fictional town of Streamship Springs. The graph also shows the marginal revenue (MR) curve, the marginal cost (MC) curve, and the average total cost (ATC) curve for the local satellite TV company, a natural monopolist. On the following graph, use the black point (plus symbol) to indicate the profit-maximizing price and quantity for this natural monopolist. ? subscription) 100 90 8 70 60 8 PRICE (Dollars per 5 40 30 20 10 0 2 MR 6 10 12 14 QUANTITY (Number of subscriptions) B 16 ATC- MC- 18 20 D Monopoly Outcome Which of the following statements are true about this natural monopoly? Check all that apply. In order for a monopoly to exist in this case, the government must have intervened and created it. wincheia

Place the black point (plus symbol) on the following graph to indicate the profit-maximizing price and quantity for BYOB. If BYOB is making a profit, use the green rectangle (triangle symbols) to shade in the area representing its profit. On the other hand, if BYOB is suffering a loss, use the purple rectangle (diamond symbols) to shade in the area representing the loss. 4.00 3.50 Monopoly Outcome 3.00 2.50 Profit 2.00 1.50 Loss ATC 1.00 0.50 MC D MR 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 QUANTITY (Thousands of cans of beer) PRICE (Dollars per unit)

3. Natural monopoly analysis The following graph gives the demand (D) curve for 5G LTE services in the fictional town of Streamship Springs. The graph also shows the marginal revenue (MR) curve, the marginal cost (MC) curve, and the average total cost (ATC) curve for the local 5G LTE company, a natural monopolist. On the following graph, use the black point (plus symbol) to indicate the profit-maximizing price and quantity for this natural monopolist. PRICE (Dollars per gigabyte of data) 2 20 18 16 14 12 10 8 6 ATC MC MR 0 0 1 2 3 4 5 6 7 8 9 10 QUANTITY (Gigabytes of data) D Monopoly Outcome Which of the following statements are true about this natural monopoly? Check all that apply. In order for a monopoly to exist in this case, the government must have intervened and created it. The 5G LTE company is experiencing economies of scale. It is more efficient on the cost side for one producer to exist in this market rather than a large number of producers. The 5G LTE company must own a…

Assume the graph represents the market for a monopolist. What quantity will the monopolist produce, and what price will she charge? What will her total revenue, costs, and profit be at this level of production? What will the deadweight loss for society be at this level of production? (Assume the MC curve is a straight line between the relevant points for this calculation.)

Which of the following statements are true about this natural monopoly? Check all that apply. O The cable company is experiencing diseconomies of scale. The cable company must own a scarce resource. ✔The cable company is experiencing economies of scale. It is more efficient on the cost side for one producer to exist in this market rather than a large number of producers. True or False: Without government regulation, natural monopolies can earn positive profit in the long run. True False

8. Natural monopoly analysis The following graph gives the demand (D) curve for satellite TV services in the fictional town of Streamship Springs. The graph also shows the marginal revenue (MR) curve, the marginal cost (MC) curve, and the average total cost (ATC) curve for the local satellite TV company, a natural monopolist. On the following graph, use the black point (plus symbol) to indicate the profit-maximizing price and quantity for this natural monopolist.   a)Which of the following statements are true about this natural monopoly? Check all that apply. O. In order for a monopoly to exist in this case, the government must have intervened and created it. O. The satellite TV company must own a scarce resource. O. It is more efficient on the cost side for one producer to exist in this market rather than a large number of producers. O. The satellite TV company is experiencing diseconomies of scale. b) True or False: Without government regulation, natural monopolies can earn…

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