Question: Consider two different ways of beating your competition.  One way is to offer your customers lower prices and better service.  The other is to get a law passed that raises your competitors' costs -- for example, by imposing special operating requirements on them.  Can you see any difference between those two methods, assuming that both succeed in keeping your competition out?  Describe the impact of each way to restrict competition on prices and output.

Name-Brand Prescription Drugs Market—“Happy Pill”—that greatly improves life but is not essential to life. Using supply and demand analysis, explain what happens to the market price and quantity of a name-brand prescription drug Happy Pill if its patent expires. Using supply and demand analysis explain why Happy Pill might be advertised. Using supply and demand analysis, explain what would happen to the price and quantity of Happy Pills if there was a severe recession, and people lost their jobs, which included a health-care benefit that payed for prescription drugs.

Some economies are less healthy than they could be because both the market power and economic profit of some favored firms are protected by either government or some private force (e.g. mafia).  Present a firm that has market power and is earning economic profit when it is maximizing profit.  Explain how competition could help consumers by showing how the profit maximizing point for this firm might change, to the advantage of consumers, if competitors entered this market and competed against this firm.

B,C,D

1. The cost function for any potential firm in a manufacturing industry is C(y) = 2 + 8y + 2y? (if a firm exits the industry, then its cost is zero). The inverse market demand function is given by P(y) = 100 – 2y. (a) If there is only one firm in the industry (the firm is a monopolist), what is the optimal output and the markup of the firm in equilibrium?

The graph below is for a firm with market power. Place point A at the firm's output and price combination. Place point B at the firm's output and price combination if the government wanted to regulate it and set a price ceiling to restrain its market power and have it produce at the level of a perfectly competitive firm. Then answer the questions.

Use the following to answer questions (1)-(6): Suppose a monopolist sells a product to consumers for which a particular consumer's choice is whether to buy 1 unit of the product or not to buy the product. In the absence of price discrimination, the market demand for the monopolist's product is: Q-150-%P. Further, the firm's short-run total cost is: TC-1000 + 100Q. Now, knowing each consumer's reservation price, imagine the monopolist wishes to engage in first-degree price discrimination. [1] A particular consumer's reservation price corresponds to the maximum amount they a willing to pay to buy 1 unit of the product. A. B. [2] Wishing to maximize profit from first-degree price discrimination, the monopolist should sell a quantity equal to: A. 50 B. 75 C. 100 D. None of the above [3] Continuing question (2), at the quantity chosen the consumer willing to pay the least for the product has a reservation price exceeding $50. A. B. [4] A. B. C. D. [5] True False A. B. C. D. [6] A. B. True…

Question 1 ( A monopolist sells Soma at the same price into two different markets. The inverse demand for Soma in market #1 is denoted p1(g) = 15 – q. The demand for Soma in market #2 is given by D2(p) = 80 – 3p. Assume the monopolist's cost function is C(q) = log(1 + q), where q represents the total quantity produced. (Note: (1) log denotes natural logarithm; (2) Round all answers to 2 decimal places.) 1. What is the profit maximizing quantity for the monopolist? 1 Answer:. Justification:

Competition policy can be defined as the set of policies and laws which regulate monopolies. which regulates mergers and cartel formation. which ensure that competition in the marketplace is not restricted in such a way as to reduce economic welfare which enhances price competition. none of the other answers are correct.

(1A) Say the government places regulation on a natural monopolist so that for its product it can only set its price so high, e.g. a price ceiling. What is this type of regulation called? Price-cap regulation Cost-plus regulation Breakeven regulation   (1B) Which of the following describes the typical shape of the monopolist's total cost curve? (a) Total costs decrease and become flatter as output rises.(b) Total costs are typically constant and are shown by a straight horizontal line.(c) Total costs rise and grow steeper as output rises. (1C) Which of the following statements is true about price discrimination In the United States. (a)Price discrimination is permitted.(b)Price discrimination is illegal.(c)Price discrimination is supported. (1D) In the economy, allocative efficiency takes place (a)when goods and services production is at their lowest costs.(b)when the mix of goods and services is at its ideal or optimal.(c) when deadweight loss of goods and services in an economy…