A monopoly firm produces an optimal output of 20 units that are sold at $70 per unit. The firm makes a negative profit and incurs a total variable cost of $1000. Explain what the firm should do? 1) The firm should shut-down operations. 2) The firm should continue to produce at a price of $70 per unit. 3) The firm should continue to produce but increase price to $100 per unit. 4) The firm should continue to produce but lower price to $50 per unit.

Subpart 7

The demand curve facing a monopoly firm is given by P=200-5Q a) What is the maximum revenue the firm can earn? b) What is the marginal cost when the profit maximizing quantity is 15? c) What is the profit maximizing quantity when the marginal cost is increased to K100? d) At a quantity of 10, what is the percentage change in demand when the price is increased from K150 to K151.5?

Which of the following is a characteristic of a monopoly? Responds to changes in the market price. It is one of several suppliers in a market. It faces no significant competition.

a) Using the following graph state the price and quantity the firm will be at if the monopoly market is in long run equilibrium. Explain why the firm will be at that price and quantity. b) State the conditions that establish the market structure monopoly, and the conditions needed for price discrimination and why firms price discriminate. (image attached)

Because of producer–producer rivalry, the price will tend to   Multiple Choice   rise up to the maximum price the consumers are willing and able to pay.   be the same as the monopoly price.   be driven to a lower price.   be the same as the competitive price.

For a monopoly, marginal revenue is less than price because A) the firm is a price taker. B) the firm must lower price if it wishes to sell more output. C) the firm can sell all of its output at any price. D) the demand for the firm's output is perfectly elastic.

Assume a monopoly firm is considering the production of two brands, 1 and 2. Marginal cost is constant at 20 for both products -- assume no fixed costs. The inverse demand for brand i is pi=140−qi−dqj , where i≠j and d is a constant.   Part A) Find the firm's QUANTITIES

A monopoly produces widgets at a marginal cost of $10 per unit and zero fixed costs. It faces an inverse demand function given by P = 50 - Q. The demand elasticity of a widget at the monopoly price and quantity is: Multiple Choice -1.5. -2.5. 2

Suppose you are a monopolist and you have two customers, A and B. Each will buy either zero or one unit of the good you produce. A is willing to pay up to $35 for your product; B is willing to pay up to $10. You produce this good at a constant average and marginal cost of $8. If you could not engage in third-degree price discrimination, what price would you charge? OA $10. OB. $15. OC. $35. OD. $45. If you could practice third-degree price discrimination, you will earn a profit of $ (For simplicity, assume that if a consumer is indifferent between buying and not buying, he will buy.) Click to select your answer(s)