9. If a firm sells its output on a market that is characterized by a single seller and many buyers of a homogeneous product for which there are no close substitutes and barriers to long-run resource mobility, then the firm is: O a. A monopolist. O b. An oligopolistic C. A perfect competitor d. A monopolistic competitor:

9. If a firm sells its output on a market that is characterized by a single seller and many buyers of a homogeneous product for which there are no close substitutes and barriers to long-run resource mobility, then the firm is: O a. A monopolist. O b. An oligopolistic C. A perfect competitor d. A monopolistic competitor:

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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I need help in these questions. Please I have 30 minutes only, Answer the questions correctly and do not make any mistake.
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8. Suppose there are two firms in the market. The market demand is Q=100-p and the marginal cost of production is constant at 40. What is the outcome of price and quantity and the total welfare if those two firms compete like perfect competition? What is the outcome of price and quantity and the total welfare when those two firms merge into a monopoly? What are the pre-merger HHI, post-merger HHI and change in HHI? How does the Horizontal Merger Guideline 2010 classify this proposed merger?
Assuming that the monopolistic competitor faces the demand and costs depicted below and finds the profit maximizing level of output, what will be the firm's profit? 36 32 28 24 20 16 12 8 4 O O 1 O MC1 ATC₁ FAVC₁ Select one: O a. $8 b. $-32 c. $-64 d. $12 x Incorrect. The profit maximizing output is 4 units where Marginal cost equals marginal revenue. At that output, use the demand curve to find the price and calculate total revenue. At that output, use the average cost curve to find the average cost and calculate total cost. Then calculate profit = total revenue - total cost. MR1 D₁ 2 3 4 5 6 7 8 9
3. Assume that a profit-maximizing firm in a monopolistically competitive industry is in long-run equilibrium. (a) Draw a correctly labeled graph that shows the profit-maximizing firm's price and output. (b) Assume that the city in which this industry operates eliminates the business license fee (a fixed cost) for all firms in this industry. How does the elimination of the license fee affect each of the following for the individual firm in the short run? Explain your answers. (i) Output (ii) Economic profits
Which of the following is a difference between monopolistic and perfect competition? O A. In perfect competition goods are identical whereas in monopolistic competition they are differentiated O B. In perfect competition firms always have zero economic profits, whereas in monopolistic competition firms always have positive economic profits O C. In monopolistic competition there are barriers to entry whereas in perfect competition there are none O D. In perfect competition the price is set by the market, but in monopolistic competition, the firm can charge whichever price they want
Question 4 All of these are characteristic of monopolistic competition, EXCEPT: O A. free entry and exit. O B. barriers to entry. OC. product differentiation. OD. price maker.
Intel and Advanced Micro Devices make most of the chips that power a PC. What makes the market for PC chips a duopoly? The PC chip market is a duopoly if O A. at the efficient scale, two firms can satisfy the market demand OB. each firm can divide its consumers into two categories-business consumers and household consumers O C. the two firms can charge different prices for the same quality of PC chip O D. the market produces two goods Assume that Intel and Advanced Micro Devices have identical costs. The graph shows the market demand curve. Draw the average total cost curve of one firm if the chip market produces 800 chips an hour and other firms are prevented from entering. Label the curve. Draw a point on the average total cost curve at the efficient scale. 110- 100- 90- 80+ 70- 60+ 50- 40- 30- 20+ 10- 0- Price (dollars per chip) 0 $800 200 400 800 600 Quantity (chips per hour) >>> Draw only the objects specified in the question. D 1000 Q Q 1200
Exhibit 10.5 Price 3.25 3.00 2.50 0 700 1,000 MC MR ATC D = AR Quantity Exhibit 10.5 shows the demand, marginal revenue, and cost curves for a monopolistically competitive firm. At the profit-maximizing (or loss-minimizing) output and price, the firm would O a. have to expand to stay in business in the long run. O b. be better off shutting down, since total revenue does not cover fixed costs. O c. be experiencing an economic loss. O d. be earning an economic profit. O e. be earning zero economic profit.
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Suppose that total demand for refrigerators at the market price is 15,000 units. If the LRAC curve reaches a clear minimum average cost at 5,000 units, then the industry structure must be Select the correct answer below: O perfectly competitive O a monopoly O an oligopoly O monopolistically competitive
b. Suppose a price-discriminating monopoly has segregated its market into two submarkets and can prevent resale between the two. Assume that its marginal cost is constant and equal to its average total cost of $8. The firm's demand schedule for the first group is given by the first two columns of the following table. Output Price MR TR AR 24 1 22 20 3 18 4 16 5 14 12 7 10 8 8