semester One Final Examinations, 2015 ECON1010 Introductory Microeconomics Accor
ID: 1152041 • Letter: S
Question
semester One Final Examinations, 2015 ECON1010 Introductory Microeconomics According to the graph below, if the firm is a monopoly and is currently charging a price of $10, what would you advise the tirmn to do f the aim of the fm is to masimise profts? 10 dollars) Quaotity (a) (b) (c) (d) Decrease price. Increase price. Leave the price unchanged. Increase price and hold output constant. 20. Consider a monopolist facing a demand curve given by P- 34-Q, where P is the market price and Q is the quantity sold. The monopolist's marginal costs (MC) equal $2 per unit and there are no other costs. If the monopolist engages in perfect price discrimination, what is the deadweight loss? (a) so (b) $36 (c) $48 (d) $96 21. Suppose that a pure monopolist is supplying a good to a market with demand of P 32-4Q. If the marginal cost of providing this good is zero and the firm charges $24, the quantity the firm is selling is____ _ units while the profit maxim ising output is units. (a) 2,8 (b) 6,8 (c) 4:2 (d) 2:4 QUESTIONS CONTINUE OVER PAGEExplanation / Answer
19)
Profit is maximized where MR=MC
and price decided by the MR =MC is $ 8.
Hence, firm must decrease its price.
Right answer is (A)
20)
In perfect price, discrimination price is set equal to the marginal cost and whole Consumer surplus is collected by producer. Thus Deadweight loss is zero,
Right answer is (A)
21)
P = 32 - 4Q
24 = 32 - 4Q
Q = 8/4
= 2
Profit Maximizing Quantity MR = MC
P = 32 - 4Q
TR = 32Q - 4Q^2
MR = 32 - 8Q
32 - 8Q = 0
Q = 32/8
= 4
Right answer is (D) (2,4)
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.