Homework Help: Economics

Posted by Marquerite on Sunday, June 1, 2008 at 3:40pm.

A PURE MONOPOLIST SELLS OUTPUT FOR $4 PER UNIT. THE MARGINAL COST IS $3, AVERAGE VARIABLE COSTS ARE $3.75, AND AVERAGE TOTAL COSTS ARE $4.25. THE MARGINAL RVENUE IS $3. WHAT IS THE SHORT RUN CONDITION FOR THE MONOPOLIST AND WHAT OUTPUT CHANGES WOULD YOU RECCOMMEND IN THE LONGER RUN?

Economics - SraJMcGin, Sunday, June 1, 2008 at 4:17pm
Thank you for using the Jiskha Homework Help Forum, but PLEASE use lower-cap letters. Capital letters are so much more difficult to read that some volunteers won't even try to read them and in computer language, it is considered rude to use caps.

Sra
Economics - economyst, Monday, June 2, 2008 at 10:50am
As MC=MR, the monopolist is at its optimal position in the short run. However, as average total cost are above $4, the firm is losing money. So, long run, either the firm shuts down, or figures out a way to cut costs.

Answer this Question

Related Questions

ECON - A pure monopolist sells output for $4.00 per unit at the current level of...
Economics - 5. A firm's marginal cost of production is constant at $5 per ...
ECONOMICS - suppose that the short run costs for a paintbrush manufacturer are ...
Economics - The accompanying table shows a car manufacturer’s total cost of...
economics - could you calulate the total, average variable, and average cost, ...
economics - could you calulate the total, average variable, and average cost, ...
economics - Teddy Bear, Inc., a rapidly growing manufacturer of high fashion ...
Economics - . Suppose the demand curve for a monopolist is QD =500 - P, and the ...
Economics - Suppose that a firm is currently employing 30 workers, the only ...
Economics - Suppose that a firm is currently employing 30 workers, the only ...

For Further Reading

First Name:
School Subject:
Answer: