econ

1. Consider a pure monopolist with short-run total cost function given by
STC = 1000 +200 Q + 12.5 Q2. Suppose also that this firm faces an inverse market demand function given by P = 800 – 20 Q.
a. How much should this firm produce and what price should it charge in order to maximize profits?
b. How much economic profit (or loss) would this firm earn?
c. What is the value of this firm’s demand elasticity at its profit-maximizing price?
d. What is the Lerner Index for this firm? LI = -1/ Ed = 0.30

1. 👍 0
2. 👎 0
3. 👁 103
1. 2. A monopolist has two plants, A and B, with respective marginal cost functions given by MCA = 10 +QA and MCB = 10 + 2QB. It faces a demand curve given by P = 70 – 1/6 Q.
a. What is the expression for this firm’s marginal cost function?
b. How much will this firm produce in order to maximize profit?
→ MC = MR
c. What price will it charge at that quantity?
d. How much output should be produced in the two respective plants

3. A pure monopsonist faces a market supply curve given by the expression P = 10 + Q. The marginal value curve for the input is given by MV = 60 – ½ Q.
a. Find how much this optimizing monopsonist will purchase of the input.
b. What price will it pay for the input?

1. 👍 0
2. 👎 0
posted by ln

Similar Questions

1. economics

This is going to be really long, but I want to see if my answers are correct. This is problem number 10.10 in my Intermediate Microeconomics book. A perfectly competitive painted necktie industry has a large number of potential

asked by sleepy on November 14, 2007
2. Economics

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

asked by Marquerite on June 1, 2008
3. ECON

A pure monopolist sells output for \$4.00 per unit at the current level of production. At this level of output, the marginal cost is \$3.00, average variable costs are \$3.75, and average total costs are \$4.25. The marginal revenue

asked by KP on March 22, 2011
4. Microeconomics

A perfectly competitive industry has a large number of potential entrants. Each firm has an identical cost structure such that long run average cost is minimized at an output of 10 units (qi=10 ). The minimum average cost is R5

asked by diegooooo on August 5, 2013
5. economics

The hand made snuffbox industry is composed of 100 identical firms, each having short-run total costs given by STC=0.5q^2+10q+5 and short-run marginal costs by SMC=q+10 where q is the output of snuffboxes per day. a. What is the

asked by jennifer on November 3, 2007

Construct a short-run supply function for a firm whose short-run cost function is C= = 0.04q^3 – 0.8q^2 +10q+5 3. The long run cost function for each firm is C = q^3 – 4q^2 + 8q. Find the industry’s long run supply curve. If

asked by Joy on November 12, 2013
7. microeconomic 2

given, STC=0.5^2 -10q -200 SMC=q-10 what is the short run average n marginal cost curve. i saw similar question posted by twitty...but i need to know how to get the answer...all the calculation..plz...

asked by eta j on March 25, 2010
8. Microeconomics help please (urgent)

True or False? Explain your reasoning. a. The short-run average total cost can never be less than the long-run average total cost. b. The short-run average variable cost can never be less than the long-run average total cost. c.

asked by David on October 22, 2008
9. Economics

The handmade snuffbox industry is composed of 100 identical firms, each having short – run total costs given by STC = 0.5q2 + 10q + 5 and short – run marginal costs by SMC = q + 10 where q is the output of snuffboxes per day.

asked by Pravinesh on November 2, 2011
10. Economics

The handmade snuffbox industry is composed of 100 identical firms, each having short – run total costs given by STC = 0.5q2 + 10q + 5 and short – run marginal costs by SMC = q + 10 where q is the output of snuffboxes per day.

asked by Pravinesh on November 5, 2011

More Similar Questions