MindTap - Cengage Le: X Course Hero x *Course Hero * *Course Hero X Course Hero X + X C https:/g.cengage.com/staticb/ui/evo/index.html?deploymentld=5813538219621591114194498&eISBN=978133... . . . CENGAGE | MINDTAP Q Search this course ? Homework: Monopoly (Ch 23) X 4. Profit maximization and loss minimization BYOB is a monopolist in beer production and distribution in the imaginary economy of Hopsville. Suppose that BYOB cannot price discriminate; that is, it sells its beer at the same price per can to all customers. The following graph shows the marginal cost (MC), marginal revenue (MR), average total A-Z E cost (ATC), and demand (D) for beer in this market. Place the black point (plus symbol) on the graph to indicate the profit-maximizing price and quantity for BYOB. If BYOB is making a profit, use the green rectangle (triangle symbols) to shade in the area representing its profit. On the other hand, if BYOB is suffering a loss, use the purple rectangle EI (diamond symbols) to shade in the area representing its loss. + bongo 4.00 3.50 Monopoly Outcome 3.00 2.50 Profit ? A+ ATC PRICE AND COST (Dollars per can) 2.00 1.50 LOSS C+ 1.00 O MC 0.50 MR D 46OF Q Search W 10:29 AM Sunny 4/6/2024 PREMindTap - Cengage Le: X Course Hero x *Course Hero * *Course Hero X Course Hero X + X C https:/g.cengage.com/staticb/ui/evo/index.html?deploymentld=5813538219621591114194498&elSBN=978133... . . . CENGAGE | MINDTAP Q Search this course ? Homework: Monopoly (Ch 23) X 1.OU PRICE AND 1.00 MC 0.50 A-Z E D 0 0.5 1.0 2.0 2.5 3.0 3.5 4.0 QUANTITY (Thousands of cans of beer) T Suppose that BYOB charges $2.00 per can. Your friend Manuel says that since BYOB is a monopoly with market power, it should charge a higher price + of $2.25 per can because this will increase BYOB's profit. bongo Complete the following table to determine whether Manuel is correct. Price Quantity Demanded Total Revenue Total Cost Profit (Dollars per can) (Cans) (Dollars) (Dollars) (Dollars) 2.00 ? 2.25 A+ Given the earlier information, Manuel correct in his assertion that BYOB should charge $2.25 per can. Suppose that a technological innovation decreases BYOB's costs so that it now faces the marginal cost (MC) and average total cost ( ATC) given on O the following graph. Specifically, the technological innovation causes a decrease in average fixed costs, thereby lowering the ATC curve and moving the MC curve. 46.F Sunny Q Search 10:29 AM 4/6/2024 PREMindTap - Cengage Le: X Course Hero x *Course Hero * *Course Hero X Course Hero X + X C https:/g.cengage.com/staticb/ui/evo/index.html?deploymentld=5813538219621591114194498&elSBN=978133... . . . CENGAGE | MINDTAP Q Search this course ? Homework: Monopoly (Ch 23) X 1.OU PRICE AND 1.00 MC 0.50 A-Z E D 0 0.5 1.0 2.0 2.5 3.0 3.5 4.0 QUANTITY (Thousands of cans of beer) T Suppose that BYOB charges $2.00 per can. Your friend Manuel says that since BYOB is a monopoly with market power, it should charge a higher price + of $2.25 per can because this will increase BYOB's profit. bongo Complete the following table to determine whether Manuel is correct. Price Quantity Demanded Total Revenue Total Cost Profit (Dollars per can) (Cans) (Dollars) (Dollars) (Dollars) 2.00 ? 2.25 A+ 750 Given the earlier information, 1,000 correct in his assertion that BYOB should charge $2.25 per can. 1,250 Suppose that a technological n decreases BYOB's costs so that it now faces the marginal cost (MC) and average total cost (ATC) given on O the following graph. Specifica 1,500 echnological innovation causes a decrease in average fixed costs, thereby lowering the ATC curve and moving the MC curve. 46.F Sunny Q Search W 10:29 AM 4/6/2024MindTap - Cengage Le: X Course Hero x *Course Hero * *Course Hero X Course Hero X + X C https:/g.cengage.com/staticb/ui/evo/index.html?deploymentld=5813538219621591114194498&elSBN=978133... . . . CENGAGE | MINDTAP Q Search this course ? Homework: Monopoly (Ch 23) X 1.OU PRICE AND 1.00 MC 0.50 A-Z E D 0 0.5 1.0 2.0 2.5 3.0 3.5 4.0 QUANTITY (Thousands of cans of beer) T Suppose that BYOB charges $2.00 per can. Your friend Manuel says that since BYOB is a monopoly with market power, it should charge a higher price + of $2.25 per can because this will increase BYOB's profit. bongo Complete the following table to determine whether Manuel is correct. Price Quantity Demanded Total Revenue Total Cost Profit (Dollars per can) (Cans) (Dollars) (Dollars) (Dollars) 2.00 ? 2.25 A+ 1,000.00 Given the earlier information, Manuel correct in his assert 2,625.00 B should charge $2.25 per can. 2,750.00 Suppose that a technological innovation decreases BYOB's costs so th ces the marginal cost (MC) and average total cost ( ATC) given on O the following graph. Specifically, the technological innovation causes 4,125.00 In average fixed costs, thereby lowering the ATC curve and moving the MC curve. 6,000.00 46.F Q Search 10:29 AM Sunny 4/6/2024MindTap - Cengage Le: X Course Hero x *Course Hero * *Course Hero X Course Hero X + X C https:/g.cengage.com/staticb/ui/evo/index.html?deploymentld=5813538219621591114194498&elSBN=978133... . . . CENGAGE | MINDTAP Q Search this course ? Homework: Monopoly (Ch 23) X 1.OU PRICE AND 1.00 MC 0.50 A-Z E D 0 0.5 1.0 2.0 2.5 3.0 3.5 4.0 QUANTITY (Thousands of cans of beer) T Suppose that BYOB charges $2.00 per can. Your friend Manuel says that since BYOB is a monopoly with market power, it should charge a higher price + of $2.25 per can because this will increase BYOB's profit. bongo Complete the following table to determine whether Manuel is correct. Price Quantity Demanded Total Revenue Total Cost Profit (Dollars per can) (Cans) (Dollars) (Dollars) (Dollars) 2.00 ? 2.25 A+ 750 Given the earlier information, correct in his assertion that BYOB should charge $2.25 per can. 1,000 Suppose that a technological n decreases BYOB's costs so that it now faces the marginal cost (MC) and average total cost (ATC) given on O 1,250 the following graph. Specifica echnological innovation causes a decrease in average fixed costs, thereby lowering the ATC curve and moving the MC curve. 1,500 46.F Q Search W 10:29 AM Sunny 4/6/2024MindTap - Cengage Lec X Course Hero x *Course Hero * *Course Hero X Course Hero X + X C https:/g.cengage.com/staticb/ui/evo/index.html?deploymentld=5813538219621591114194498&eISBN=978133... . . . CENGAGE | MINDTAP Q Search this course ? Homework: Monopoly (Ch 23) X MR D 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 QUANTITY (Thousands of cans of beer) A-Z E o Suppose that BYOB charges $2.00 per can. Your friend Manuel says that since BYOB is a monopoly with market power, it should charge a higher price T of $2.25 per can because this will increase BYOB's profit. EI + Complete the following table to determine whether Manuel is correct. bongo Price Quantity Demanded Total Revenue Total Cost Profit (Dollars per can) (Cans) (Dollars) (Dollars) (Dollars) 2.00 2.25 Given the earlier information, Manuel correct in his assert 1,000.00 DB should charge $2.25 per can. (? 2,625.00 A+ Suppose that a technological innovation decreases BYOB's costs so th ces the marginal cost (MC) and average total cost (ATC) given on 2,750.00 the following graph. Specifically, the technological innovation causes In average fixed costs, thereby lowering the ATC curve and moving the MC curve. 4,125.00 6,000.00 O Place the black point (plus symbol) on the following graph to indicate the profit-maximizing price and quantity for BYOB. If BYOB is making a profit, use the green rectangle (triangle symbols) to shade in the area representing its profit. On the other hand, if BYOB is suffering a loss, use the purple rectangle (diamond sumbols) to shade in the area representing the loss. 46.F Sunny Q Search 10:30 AM 4/6/2024MindTap - Cengage Lec X Course Hero x *Course Hero * *Course Hero X Course Hero X + X C https:/g.cengage.com/staticb/ui/evo/index.html?deploymentld=5813538219621591114194498&elSBN=978133... . . . CENGAGE | MINDTAP Q Search this course ? Homework: Monopoly (Ch 23) X Suppose that BYOB charges $2.00 per can. Your friend Manuel says that since BYOB is a monopoly with market power, it should charge a higher price of $2.25 per can because this will increase BYOB's profit. A-Z E o T Complete the following table to determine whether Manuel is correct. EI Price Quantity Demanded Total Revenue Total Cost Profit (Dollars per can) (Cans) (Dollars) (Dollars) (Dollars) + 2.00 1 2 2.25 bongo Given the earlier information, Manuel correct in his assertion that BYOB should charge $2.25 per can. Suppose that a technological innovation is not ases BYOB's costs so that it now faces the marginal cost (MC) and average total cost (ATC) given on the following graph. Specifically, the to is ical innovation causes a decrease in average fixed costs, thereby lowering the ATC curve and moving the MC curve. (? A+ Place the black point (plus symbol) on the following graph to indicate the profit-maximizing price and quantity for BYOB. If BYOB is making a profit, use the green rectangle (triangle symbols) to shade in the area representing its profit. On the other hand, if BYOB is suffering a loss, use the purple rectangle (diamond symbols) to shade in the area representing the loss. C- O (? 46.F Q Search T W 10:30 AM Sunny 4/6/2024MindTap - Cengage Lec X Course Hero x *Course Hero * *Course Hero X Course Hero X + X C https:/g.cengage.com/staticb/ui/evo/index.html?deploymentld=5813538219621591114194498&eISBN=978133... . . . > > CENGAGE | MINDTAP Q Search this course ? Homework: Monopoly (Ch 23) X Place the black point (plus symbol) on the following graph to indicate the profit-maximizing price and quantity for BYOB. If BYOB is making a profit, use the green rectangle (triangle symbols) to shade in the area representing its profit. On the other hand, if BYOB is suffering a loss, use the purple rectangle (diamond symbols) to shade in the area representing the loss. E ? A-Z o 4.00 3.50 Monopoly Outcome + 3.00 1 2 2.50 Profit bongo PRICE AND COST (Dollars per unit) 2.00 1.50 Loss ATC 1.00 0.50 ? A+ MC MR D 0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 QUANTITY (Thousands of cans of beer) O Grade It Now Save & Continue 46.F T 10:30 AM Sunny Q Search 4/6/2024 PRE