A) Suppose that MiniChirp faces a capacity constraint of 125 units: (QA + QNZ ≤ 125). What price that MiniChirp will charge in each country? B) Suppose that MiniChirp faces a capacity constraint of 20 units: (QA + QNZ ≤ 20). What is the lowest price that MiniChirp will charge in each country?
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Hello! Just stuck on answering these questions. Explaining the answer would be greatly appreciated. Thank you.
A) Suppose that MiniChirp faces a capacity constraint of 125 units: (QA + QNZ ≤ 125). What price that MiniChirp will charge in each country?
B) Suppose that MiniChirp faces a capacity constraint of 20 units: (QA + QNZ ≤ 20). What is the lowest price that MiniChirp will charge in each country?
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- Problem 3 = Suppose that a MiniChirp is a monopoly microchip manufacturer who faces the following demand curves for its product in two different countries: Australia (A) and New Zealand (NZ). Australia: QA 400 - PA, New Zealand: QNz = 150 - PNZ, where p; and Q, denote the price and quantity sold in country i respectively. MiniChirp's cost function is given by c(Q) = 0.25(QA + QNZ)². Assume that resale between countries is not possible and that MiniChirp is a profit maximiser. (a) Find the prices, PA and PNZ, which maximise MiniChirp's profits, assuming no capacity constraints. (b) Suppose that MiniChirp faces a capacity constraint of 250 units: (QA+QNz ≤ 250). What price that MiniChirp will charge in each country? (c) Suppose that MiniChirp faces a capacity constraint of 125 units: (QA+QNz ≤ 125). What price that MiniChirp will charge in each country? (d) Suppose that MiniChirp faces a capacity constraint of 20 units: (QA+QNz ≤ 20). What is the lowest price that MiniChirp will charge…A company operates two plants which manufacture the same item and whose total cost functions are C₁ = 5.1 +0.04(q₁)² and C₂ = 7.4 + 0.02(92)², where q1 and 2 are the quantities produced by each plant. The company is a monopoly. The total quantity demanded, q = 91 + 92, is related to the price, p, by p = 40 -0.02q. How much should each plant produce in order to maximize the company's profit?¹ 91 = i 92 = iAssume that Gas & Minerals is the only copper mining firm in Chile. The national demand for copper in thousands of tonnes per month is: q^d(p) = 15 - pThe total costs in millions of dollars are: c(q) = 5q(a) What would be the profit-maximising level of production for this firm? Determine the monopoly price and quantify the profits. Graph the demand, marginal revenue and marginal cost, identifying their values along with determining the social loss generated and identifying it in the graph above. Assume now that due to a bad internal restructuring, the operations manager was fired and a professional with little mining experience was hired. The new manager does not know environmental protocol and mining waste (tailings) has gotten out of control and has been dumped into a river. This generated a negative externality on copper production. The estimated damage is US$5 million per 1,000 tonnes.(b) Obtain the social marginal cost of this mining activity.(c) What level of production will…
- In the 1928, Knoxville was served by a single railroad line. Because alternative forms of transportation were not close substitutes for rail transportation in 1928, this railroad had a transportation monopoly in Knoxville. The estimated monthly fixed cost associated with operating a railroad was $1,200. In addition, there was a constant average variable cost and marginal cost of $0.02 per ton-mile associated with the railroad's operation. The estimated monthly demand for transportation on the railroad was: Qd = q = 80,000 - 1,000,000P where Qd was the monthly quantity demanded in ton-miles and P was the price per ton-mile in dollars. Based upon the above equation, answer the following questions: a. What is the profit-maximizing price and quantity? b. Would a private company build the railroad? c. What is the socially optimal price and quantity?The demand and total cost functions for a monopoly firm are:Q(P) = 39.5 – 0.5PTC(Q) = 60 – Q + 0.5 Q2a) Plot the demand, marginal revenue, marginal cost, and average total cost curves, including the intersections with the horizontal and vertical axes. b) What are the profit maximising QM and PM for this firm? c) What is the firm’s profit πM? d) What are the firm's fixed and variable costs? e) What would be the socially optimal Q* and P* (round to 1 decimal place if needed)?Eyeglasslux is a single-price monopolist in the eye-glass frame market. It faces a Market demand given by Q=355-2P. Its only cost is a Marginal Cost of MC=Q What is the Marginal Revenue for the 268th unit?
- A monopolist’s inverse demand function is estimated as P = 450 − 3Q. The company produces outputat two facilities; the marginal cost of producing at Facility 1 is M C1(Q1) = 2Q1, and the marginal costof producing at Facility 2 is M C2(Q2) = 6Q2.(a) Provide the equation for the monopolist’s marginal revenue function.(b) Determine the profit maximizing level of output for each facility.(c) Determine the profit maximizing price.Assume that Hydro One is the sole electricity distributor in Ontario, i.e. the market for distributing electricity is an actual monopoly. The demand of electricity is given by P 250,000 – 3Q where Q the quantity is measured in Gigawatt-hour (GWh). The price is measured in dollars per GWh. The total cost of Hydro One is given by: Cost = 100 Q? + 90,000Q + 1,500,000,000 a. Distinguish between natural and legal monopolies. Is Hydro One legal or natural monopoly? Explain your answer. b. Draw the marginal revenue curve for Hydro One. c. Determine the profit maximizing level of output for Hydro One. d. What is the selling price of electricity that Hydro One should charge? Compute its profit at this price. Can Hydro One sustain this profit over long term? e. Compute the deadweight loss resulting from the monopoly.Suppose a certain city has a monopoly cable-television company. This company has total costs TC = 0.25Q2 + 30Q + 70. (Hint: using calculus, this means MC = 0.5Q+ 30since MC is the derivative of TC with respect to output.) The demand in the community is approximated by the equationQd = 60- P/2(alternatively, you can write the demand equation as Qd = 60–0.5P). Graphically depict the demand curve as well as the marginal cost (MC) curve. If the cable company is free to choose its own pricePm and quantityQm, graphically depictthe monopoly equilibrium price and quantity. Add any other curve(s) to your diagram that may be required to obtain this outcome. Compute and state the exact monopolist equilibrium pricePm and quantityQm that you depicted graphically.
- A firm is originally operating as a single-price monopolist that faces a market demand curve ?(?)=190−1/6?and total cost curve equal toTC(Q)=30,500+42Q, with constant MC equal to ??(?)=42for all units produced. Part (a): How much output does the firm produce and at what price is each unit sold for? Part (b): Calculate the firm’s profit. The firm now realizes there are actually two distinct groups of consumers that purchase their product, with the following demand functions: ?(?1)=168−1/4?1 ?(?2)=234−1/2?2 Their total and marginal cost curves have not changed. If the firm wanted to successfully practice third-degree price discrimination: Part (c): How many units of output would they sell to group 1 and how much will each consumer in group 1 pay? Part (d): How many units of output would they sell to group 2 and how much will each consumer in group 2 pay? Part (e): How much profit is earned by the firm when they practice third-degree price discrimination? Part (f): How much did profits…Consider the case of a monopolist who charges the same price to all consumers. The demand for the good is given by Q=813-7p, where Q denotes the quantity demanded at price p. The firm's total cost of producing Q units is given by the function C(Q) = 7 Q What is the profit maximizing price for this monopolist? (As usual, you must enter a number below, not a ratio, not an expression with symbols..., just a number.)CHP is a monopoly manufactorer who faces tbge following demand curve for its product in two different country: United States ( US) and New Zealand (NZ). US = Q(us) = 200 - P(us) and new zealand: Q(nz) = 150 - 1/2 P(nz). in which Q denotes quantity and p denotes prices. the firm also faces cost function of c(Q) = 0.25 (Qus + Qnz)^2. Find the prices, pUS and pNZ, which maximise CHP profits, assuming no capacity constraints.