What is the monopolist optimal supply

Assignment Help Business Economics

Reference no: EM131169361

Suppose there are 100 firms in a perfectly competitive industry. Each firm has a U-shaped, long-run average cost curve that reaches a minimum of $10 at an output level of 8 units. Marginal costs are given by and market demand is given by MC(q) = q + 2 Q=1000-20P Suppose instead there was a single supplier whose marginal cost curve is MC(Q) =(1/100)Q+2 1) what is the monopolist’s optimal supply? 2) Explain why this outcome is inefficient in comparison to the competitive outcome.

Reference no: EM131169361

Questions Cloud

Calculate producer surplus and consumer surplus : Use the following equations for supply and demand to solve for the market equilibrium price and quantity, and produce a graph for the market. P = 1/2Qs + 2 P = −3Qd + 15. Suppose that a price floor of $9 dollars is imposed on the market; graphically ..

Determine the firm optimal advertising-to-sales ratio : The elasticity of demand for a firm’s product is -3 and its advertising elasticity of demand is 0.15. Determine the firm’s optimal advertising-to-sales ratio. If the firm’s revenues are $60,000, what is its profit-maximizing level of advertising?

Explanation for stagflation : Which of the following is not an explanation for stagflation? Stabilization policies and FED intervention created an inflationary bias over time, which required higer rates of unemploymentto retsrain inflation.

What level of output should you produce to maximize profits : You are the manager of a monopolistically competitive firm. The inverse demand curve you face is P = 50 – 4Q. Your cost function is C(Q) = 10 + 2Q. What level of output should you produce to maximize profits? What is your profit and what will happen..

What is the monopolist optimal supply : Suppose there are 100 firms in a perfectly competitive industry. Each firm has a U-shaped, long-run average cost curve that reaches a minimum of $10 at an output level of 8 units. Marginal costs are given by and market demand is given by MC(q) = q + ..

Net worth relative to the total original asset value : Suppose First National Bank holds $100 million in assets with an average duration of 4 years, and it holds $85 million in liabilities with an average duration of 3 years. Further suppose there is a 2-percentage-point increase in interest rates. Calcu..

What is the four-firm market concentration ratio : In Savannah, Georgia, the retail gasoline market consists of 8 firms. Firm 1 has 30% of the market, Firms 2 and 3 have 20% each and the remaining firms have 6% each. What is the four-firm market concentration ratio for this industry?

How so many more of us can be forced to subsidze few of them : There are more than 150 million eligible voters in the U.S. and only a few hundred sugar growers. And yet, the sugar growers in the U.S. have succeeded in getting the U.s. Congress to pass legislation limiting the amount of sugar that can be importat..

Assume the marginal propensity to consume : In order to financially stimulate the nation, the Federal government injected $900 billion dollars into the economy. However, the results were less than spectacular. One reason could have been a failure to understand the marginal propensity to consum..

User Account

All Pages