If a single firm with constant marginal costs of £8 monopolizes a market with a demand of Q=100-2P (where Q is the quantity and P is the price), how large is the Consumer Surplus and prodcuer surplus?
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If a single firm with constant marginal costs of £8 monopolizes a market with a demand of Q=100-2P (where Q is the quantity and P is the price), how large is the
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- Rich Uncle Pennybags is the only seller of board games in Atlantic City, New Jersey. The inverse demand curve for board games is given by: P= 40–0.5q where q is in hundreds of games per month. Rich Uncle Pennybags' marginal cost of producing board games is: MC = 7+0.1q . How much surplus will buyers receive from a perfectly price discriminating Uncle Pennybags, and how much producer surplus will Uncle Pennybags capture? Then, calculate what the deadweight loss due to monopoly will be.Assume as a starting point a single firm with constant marginal costs of £8 which monopolizes a market with demand Q=100-2P (Q=Quantity, P=Price). Now presume that the firm is reducing the monopoly price by £10. How large is the Consumer Surplus? how large is the producer surplus?A manufacturer faces the demand function, 20Q + 5P = 120 (where Q is quantity and P is price), and has the marginal cost function, MC = 1+ 0.8Q. If the manufacturer maximises revenue instead of profit, how will this affect consumer surplus?
- Now suppose that the monopolist chooses q to maximise its profit. The consumer surplus at this profit maximising quantity would be?The movie distributor charges a movie theatre $4 per ticket to rent a movie. Suppose the theatre can seat a maximum of 200 people. The demand for the movie is different for the afternoon showing and for the evening showing. Based on the demand function P = 10 – Q/10 for the afternoon showing and P = 20 – Q/10 for the evening showing, the marginal-revenue function for the afternoon is MR = 10 – Q/5 and for the evening is MR = 20 – Q/5. a. Calculate the profit-maximizing price in the evening and the afternoon; also calculate how many tickets will be sold for each show. b. Suppose that the movie distributor now charges a flat fee of $1000 to show the movie regardless of the number of tickets sold. Will the movie theatre owner prefer this arrangement? Why or why not?If a monopoly faces an inverse demand curve of p=450-Q, has a constant marginal and average cost of $30, and can perfectly price discriminate, what is its profit? What are the consumer surplus, welfare, and deadweight loss? How would these results change if the firm were a single-price monopoly? Profit from perfect price discrimination () is $88200. (Enter your response as a whole number.) Corresponding consumer surplus is (enter your response as whole numbers): welfare is and deadweight loss is Profit from single-price profit-maximization is = $44100. (Enter your response as a whole number.) Corresponding consumer surplus is (enter your response as whole numbers): welfare is and deadweight loss is CS = $0 W = $ 88200 DWL = $0. CS = $ 22050 W = $ 66150 DWL = $ 22050
- If a single firm with constant marginal costs of £8 monopolizes a market with demand Q=100-2P (Q=quantity, P=price), how large is the Producer Surplus 1746 882 881 253 771If a monopoly faces an inverse demand curve of p=330-Q, has a constant marginal and average cost of $90, and can perfectly price discriminate, what is its profit? What are the consumer surplus, welfare, and deadweight loss? How would these results change if the firm were a single-price monopoly? Profit from perfect price discrimination () is $ 28800. (Enter your response as a whole number.) Corresponding consumer surplus is (enter your response as whole numbers): welfare is and deadweight loss is CS=$ W = $ DWL = $ AConsider a market with demand function P = 12 - 0.04Q and marginal cost function P = 6 + 0.12Q. (a) If this market is perfectly competitive, compute the equilibrium price, the equilibrium quantity, the consumer surplus and the producer surplus in the market. (b) If this market is a monopoly, compute the equilibrium price, the equilibrium quantity, the consumer surplus, the producer surplus and the deadweight loss (if any) in the market. Support your answers for (a) and (b) with one suitable market diagram
- How much is total surplus if the market is perfectly competitive?How much is total surplus if the market is controlled by a single price monopolist?Suppose the single price monopolist started charging all customers the maximum price they are willing to pay. How much additional surplus is created?Assume that the demand function for tuna in a small coastal town is given by 140 p = (200 < q < 800), q0.5 where p is the price (in dollars) per pound of tuna, and q is the number of pounds of tuna that can be sold at the price p in one month. (a) Calculate the price (in $ per Ib) that the town's fishery should charge for tuna in order to produce a demand of 400 pounds of tuna per month. per Ib (b) Calculate the monthly revenue R (in dollars) as a function of the number of pounds of tuna q. R(q) = (c) Calculate the revenue and marginal revenue (derivative of the revenue with respect to q) at a demand level of 400 pounds per month. revenue marginal revenue per Ib of tuna Interpret the results. At a demand level of 400 pounds per month, the revenue is $ and increasing at a rate of $ per additional pound of tuna.Each consumer has the following demand for annual visits to Planet Fitness: Q = 100 - P, where Q is the number of visits to Planet Fitness per year and P is the price per visit. In western Maryland, Planet Fitness has a monopoly on the gym market in the area. If the marginal cost of serving each customer is $10 per visit, what is the optimal two-part tariff that Planet Fitness could charge each customer? Annual fee = $4,050; P = $10 for each visit Annual fee = $5,000; P = $0 for each visit. Annual fee = $4,050; P = $0 for each visit. Annual fee = $5,000; P = $10 for each visit.
