As a Manager in charge of pricing in an organisation, you have a deep understanding of how elasticity of demand affects your business. Give atleast 3 factors that affect elasticity of demand.
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-As a Manager in charge of pricing in an organisation, you have a deep understanding of how
-Explain two(2) benefits of
-Patel and John are arguing on whether
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- HW#5 (Monopoly, Monopolistic Competition, Oligopoly) Back to Assignment Attempts: Keep the Highest: /3 2. The components of marginal revenue Jake's Fire Engines is the sole seller of fire engines in the fictional country of Pyrotania. Initially, Jake produced seven fire engines, but he has decided to increase production to eight fire engines. The following graph shows the demand curve Jake faces. As you can see, to sell the additional engine, Jake must lower his price from $100,000 to $50,000 per fire engine. Note that while Jake gains revenue from the additional engine he sells, he also loses revenue from the initial seven engines because he sells them all at the lower price. Use the purple rectangle (diamond symbols) to shade the area representing the revenue lost from the initial seven engines by selling at $50,000 rather than $100,000. Then use the green rectangle (triangle symbols) to shade the area representing the revenue gained from selling an additional engine at $50,000. (?…How do the results of a competitive industry compare with that of a monopolistic industry? Group of answer choices -Competition results in lower prices and greater production. -Competition results in higher prices and higher production. -Competition results in higher prices and lower production. -Competition results in lower prices and lower production.Exercise A.3 Compare the competitive equilibrium with that of the first-degree price discriminating monopolist. Indicate the similarities and differences that exist in prices, quantities produced, consumer surplus and loss of efficiency between both situations. Represent graphically assuming that the marginal cost is constant
- Question 3A. Define the term Monopoly, giving ONE (1) example of such in Jamaica. B. Discuss TWO (2) reasons for the existence of monopolies.C. Outline FOUR (4) differences and THREE (3) similarities between the monopoly and monopolistic market structures. D. With the aid of a graph, illustrate a monopoly making a profitCOURSE: MICROECONOMICS 2 - MONOPOLY IN DURABLE GOODSA monopolistic firm has estimated its inverse demand function as P = 200 − 0.5 Q + 40*(1/UL) with a increasing marginal cost (MC) estimated to be 10 Q. (a) Estimate effect on firm's extraordinary profit if it changes useful life (UL) of its product from 8 years to 5 years. b) What will happen to selling price?7. Suppose you are employed at a monopolistic company as a research (pricing) economist and you are deriving the behavior of two markets based on demand curves given by:D1(p1) = 50 − p1D2(p2) = 50 − 2p2 Assume that the marginal cost is constant at $8 a unit.(a) If it can price discriminate, what price should it charge in each market in order to maximize profits? (b) If it can’t price discriminate, what price should it charge? 8. Pele enjoys coffee (C) and tea (T) according to the function Replace 'Pele' with Alana U(C, T) = 3C + 4T(a) What does her utility function say about her MRS of coffee and tea?(b) Suppose the price of coffee (PC) and the price of tea (PT) are both $3. If Alana has $12 to spend on these products,i. How much coffee and tea should she buy to maximize her utility? ii. Draw a carefully labeled graph of her indifference curve map and her budget constraint. Put the quantities of coffee on the horizontal axis. Be sure to identify the utility maximizing point.(c)…
- COURSE: MICROECONOMICS 2 - MONOPOLY AND PRICE DISCRIMINATION TYPE 2 - PRICE PER CONSUMPTION BRACKETA monopolistic firm has estimated its inverse demand function as P = 200 - q and its marginal cost (MC) equal to 30.a) Estimate excess profit, with a SINGLE PRICE SYSTEM. Graphicb) Estimate excess profit if firm discriminates by bracket, defining following brackets: (0, 50), (51 to 100) (101 to 150). PLEASE GRAPHIC EACH CASEFirms compete in different types of market structures. In the real world, most markets are either monopolistically competitive or oligopolistic, and a few markets have a monopoly. Note that perfect competition is rare because no market has all the characteristics of a perfectly competitive market as described by the theory of perfect competition. 1. (a) What is a monopoly? Give an example. (b) How many firms are there in the Internet provider market? Is it easy or difficult for new firms to set up and compete in this industry? Explain. (c) How do firms in the Internet provider market compete?Question 22 A monopolistically competitive market is like a monopoly in that both market structures feature easy entry by new firms in the long run. the main objective of firms in both market structures is something other than profit maximization. firms in both market structures produce the welfare-maximizing level of output. firms in both market structures set price above marginal cost. 1 Question 23 A monopolistically competitive market is like a competitive market in that
- 5. Monopoly outcome versus competition outcome Consider the daily market for hot dogs in a small city. Suppose that this market is in long-run competitive equilibrium, with many hot dog stands in the city, each one selling the same kind of hot dogs. Therefore, each vendor is a price taker and possesses no market power. The following graph shows the demand (D) and supply curves (S = MC) in the market for hot dogs. Place the black point (plus symbol) on the graph to indicate the market price and quantity that will result from competition. Use the green point (triangle symbol) to shade the area that represents consumer surplus, and use the purple point (diamond symbol) to shade the area that represents producer surplus. PRICE (Dollars per hot dog) 5.0 4.5 PRICE (Dollars per hot dog) 4.0 3.5 3.0 2.5 1.0 0.5 0 5.0 Show Transcribed Text 4.5 4.0 3.5 3.0 0 20 1.0 0.5 40 Assume that one of the hot dog vendors successfully lobbies the city council to obtain the exclusive right to sell hot dogs…Question: Which of the following market structures is characterized by a large number of firms, homogeneous products, free entry and exit, and perfect information? a) Monopoly b) Oligopoly c) Monopolistic competition d) Perfect competition Please give me correct answer and full explanation. Note:- Please avoid using ChatGPT and refrain from providing handwritten solutions; otherwise, I will definitely give a downvote. Also, be mindful of plagiarism. Answer completely and accurate answer. Rest assured, you will receive an upvote if the answer is accurate.ICE (Dollars per scooter) 3. How short-run profit or losses induce entry or exit Citrus Scooters is a company that manufactures electric scooters in a monopolistically competitive market. The following graph shows the demand curve, marginal revenue curve (MR), marginal cost curve (MC), and average total cost curve (ATC) for Citrus. Place the black point (plus symbol) on the graph to indicate the short-run profit-maximizing price and quantity for this monopolistically competitive company. Then, use the green rectangle (triangle symbols) to shade the area representing the company's profit or loss 500 450 400 360 200 250 200 150 400 50 MC- ATC MR Demand 150 200 250 300 360 400 450 500 QUANTITY (Scooters) + Monopolistically Competitive Outcome Profit or Loss (?) Given the profit-maximizing choice of output and price, Citrus Scooters is earning sellers in the industry relative to the long-run equilibrium amount. Now consider the long run in which scooter manufacturers are free to enter and…