Question #4: Using the following graph to answer the follwing questions: 100 MC ATC AVC 20 MR 1,000 2.000 3,000 4.000 5,000 MC is marginal cost, MR is marginal revenue, ATC is average total cost, AVC is average variable cost and D is the demand curve. a. By looking at this graph, what can you say about the market power of this firm? Is it a perfect competition or a monopoly? Explain. b. To maximize the profit, how many units should the firm produce? At what price? c. Based on your answer, what is the total revenue? Total costs? Total profit? Total fixed cost? d. Will you operate this firm in the short run? Long run? Briefly explain. e. How do you measure monopoly power? mopl eo pue senu

Question #4: Using the following graph to answer the follwing questions: 100 MC ATC AVC 20 MR 1,000 2.000 3,000 4.000 5,000 MC is marginal cost, MR is marginal revenue, ATC is average total cost, AVC is average variable cost and D is the demand curve. a. By looking at this graph, what can you say about the market power of this firm? Is it a perfect competition or a monopoly? Explain. b. To maximize the profit, how many units should the firm produce? At what price? c. Based on your answer, what is the total revenue? Total costs? Total profit? Total fixed cost? d. Will you operate this firm in the short run? Long run? Briefly explain. e. How do you measure monopoly power? mopl eo pue senu

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter15: Economic Regulation And Antitrust Policy

Section: Chapter Questions

Problem 10PAE

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Question #4: Using the following graph to answer the following questions: 100 MC ATC AVC 1,000 2.000 3,00 4.000 5,000 MC is marginal cost, MR is marginal revenue, ATC is average total cost, AVC is average variable cost and Dis the demand curve. a. By looking at this graph, what can you say about the market power of this firm? Is it a perfect competition or a monopoly? Explain. b. To maximize the profit, how many units should the firm produce? At what price? c. Based on your answer, what is the total revenue? Total costs? Total profit? Total fixed cost? d. Will you operate this firm in the short run? Long run? Briefly explain. e. How do you measure monopoly power? smopi oo pue senuna
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