As the only producer in the apple market, at what price, how many apples would Alex sell per week in order to maximize his economic profit? Calculate his producer surplus.
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As the only producer in the apple market, at what price, how many apples would Alex sell per week in order to maximize his economic profit? Calculate his
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- Exercise 4.2 "With respect to the monopoly equilibrium without price discrimination, first-degree price discrimination increases the profit of the enterprise at the expense of reducing social welfare." Do you agree with this statement? Reason your answer and represent graphically.Exercise A.6 A monopolist facing the demand curve Q = 42 – 0.6P operates with constant average and marginal costs equal to 20. a) Calculate the quantity, price and profit obtained by the monopolist. Represent graphically. (b) What quantity, what price and what benefit will you get if you can apply first-degree price discrimination? Calculate the consumer surplus and represent graphically. c) The monopolist warns that he can separate consumers into two distinct groups with demands Q1 = 12 - 0.1P1 and Q2 = 30 - 0.5P2. Calculate the quantities, the prices you will set in each market, and the profit you will make. Represent graphically.A manufacturer of icrowaves has discovered that male shoppers have little value for microwaves and attnbute almost no exxtra value to an auto- defrost feature. Female shoppers generally value microwaves more than men do and attribute greater value to the auto-defrost feature. There is little additional cost to incorporating an auto-defrost feature. Since men and women cannot be charged different prices for the same product, the manufacturer is considering introducing two different models. The manufacturer has determined that men value a simple microwave at $68 and one with auto-defrost at $82, while women value a simple microwave at $82 and one with auto-defrost at $150. Suppose the manufacturer is considering three pricing strategies: 1. Market a single microwave, with auto-defrost, at $82, to both men and women. 2. Market a single microwave, with auto-defrost, at $150, to only women. 3. Market a simple microwave to men, at $68. Market a microwave, with auto-defrost, to women at $135.…
- How is voluntary simplicity related to thematerialism value? What are the marketingimplications of voluntary simplicity? Do theseimplications vary by product class?A natural monopoly packages Alaskan moss, a unique health product that has no substitutes. The graph illustrates the demand curve for this health product. Price and cost (cents per bag) Q Q 50- D 7 Quantity (thousands of bags per year) >>> Draw only the objects specified in the question Draw the monopoly's marginal revenue curve and label it. If the marginal cost is 30 cents a bag, draw the monopoly's marginal cost curve and label it. Draw a point at the monopoly's profit-maximizing quantity and price How many bags a year does the monopoly sell and what is the price of a bag? The monopoly sells bags a year and the price is cents a bag. >>> Remember that the quantity given on the axis is in thousands of bags.Exercise 3.9. Describe the two problems that arise when regulators tell a natural monopoly that it must set a price equal to marginal costs.
- What problems does underforecasting demand create?T/F There is a asymmetric knowledge in the monopoly market among the buyers and sellers.9. The kinked demand curve Wilke is a manufacturer in the oligopolistically competitive market for footballs. Two other manufacturers, Rawlding and Spaldon, compete with Wilke for football consumers. Wilke faces the kinked demand curve for footballs depicted on the graph. Initially, Wilke charges $30 per football, producing and selling 7 million footballs per year. PRICE (DOLLARS PER BALL) 36 35 34 33 32 31 30 29 28 27 28 5 в 7 8 FOOTBALLS (Millions of balls) 9 10 ? As an oligopolist, Wilke is a price maker. If Wilke raises the price of its football from $30 to $32 per ball, the quantity of Wilke footballs demanded million footballs per year. If Wilke reduces the price of its football from $30 to $28 per ball, the quantity of footballs demanded million footballs per year. (Hint: Mouse over the points on the graph to see their coordinates.) by by If Wilke lowers the price of its football below $30, the kinked demand curve model suggests that Rawlding and Spaldon will respond by
- Exercise A.8. Is it possible that monopoly regulation through the establishment of a maximum price results in an increase in social welfare and generates the appearance of unsatisfied demand (excess demand)? Illustrate your answer with graphs and discuss them.A telephone company has isolated three distinct demands for its services:Weekdays: Q1=90-0.5P1Holidays: Q2=35-0.25P2Nights: Q3=30-0.2P3TC=25+20Q WHERE Q=Q1+Q2+Q3Show that as a discriminatory monopolist this company will maximize profits by charging the highest price in the market where the price elasticity of demand is lowest, by finding a) the profit maximizing level of outputb)the profit maximizing price and c) the price elasticity of demand in each marketUse Cramer's rule for solving simultaneous equations and the Hessian for the second order conditionsmonopolyStart from a market where a monopoly prevails. Select the option or options below that are correct. Select one or more options: a-The monopolist maximizes profit where MR = MC b-A monopolist always has the opportunity to make a profit c-The individual monopolist has no market power as it meets a completely elastic demand. d-The monopolist will charge a higher price than the marginal cost of the selected quantity. e-The monopolist is free to choose the price charged for a given quantity because consumers have no competitor to go to