1:34 AM learn.unt.edu AT&T; LTE Econ 1100 Name Print Last Name, First Name You c
ID: 1114460 • Letter: 1
Question
1:34 AM learn.unt.edu AT&T; LTE Econ 1100 Name Print Last Name, First Name You cannot get assistance from the Help Center on this assignment. Seores: This assignment replaces class on Wedhesday, November 22 and is worth 2 In-Class Grades. It is dae when called for during class on Monday, November 27. You can print it double-sided; if you print on two pages, both pages MUST be stapled sogether in the upper left comer. 1 In the ong run, a monopoly firm can earn economic profit dae to the existence of 2. Amonopoly firm that can scparate its customers imo groups with different elasticities of demand and prevent those groups from trading wih cach other may be able to engage in price Fill in the blanks for 3-5 using the graph belew, which represents a profit-maximizingloss-minimizing firm. . This firm will produce units of Price output and charge a price of MC MSC . This firm is carning a ATC P: economic profit in the short run equal to the AVC Pi 5. The deadweight oss is equal to the Po Quantity 6. Ceteris paribus, the price charged in a monopoly market is than the price chargod if the market is competitive; the output producod in a monopoly market is than the output produced if the market is competitive
Explanation / Answer
1. In the long run, the firm is able to earn supernormal or positive profits due to the presence of economies of scale. This means as the monopoly firm increases the quantity produces, cost per unit decreases and profit increases.
2. The firm by seperating the different groups, is able to enagage in price discrimination.
3. The firm maximises profit by producing a quantity where MR=MC and charges a price at which this quantity intersects price. The firm charges price P2 and produces quantity Q0.
4. Profit=(price-ATC) quantity
profit is the area P1P2km
5. Deadweight loss is equal to the triangular area kze.
6. In monopoly, price charged is higher than price charged in perfect competition and quantity is lowe than PC.
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