monopolies, 15 questions, thank you!

Name: Period: Monopolies Part 1: Check you Understanding- Answer the following question. 1. Explain why a perfectly competitive firm is a "price taker" and the monopoly is a "price maker". Part 2: Monopoly Practice- Use the graph below of a non-price discriminating monopoly to answer the follow questions. 2. Identify the profit maximizing price $90 and quantity. Price 3. Calculate the total revenue at the $80 profit maximizing price and quantity. $70 4. Calculate the total cost at the profit maximizing price and quantity. $6 MC 5. Calculate the profit or loss at the $50 profit maximizing price and quantity. ATC 6. Calculate the area of deadweight $40 loss. Show your work. 7. Identify the socially optimal (or $30 allocationy efficient) price and $20 quantity. 8. Identify the price and quantity where $10 the total revenue is maximized MR 9. At the price of $70, is the demand 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 relatively elastic, relatively inelastic, Quantity (Tons) or unit elastic? 10. Assume that the government levies a $15 per unit tax on this monopoly. Identify the profit maximizing price and quantity after the tax is imposed. 11. Assume instead that the government provides this monopoly with a $15 per unit subsidy. Identify the profit maximizing price and quantity after the subsidy. Part 3: Additional Practice- Assume instead that the costs of production changed for this monopoly so that the marginal cost (MC) and average total cost (ATC) for every unit was $50. 12. Under these new circumstances, identify the profit maximizing price and quantity. 13. Calculate the total revenue at the profit maximizing price and quantity. 14. Calculate the total cost at the profit maximizing price and quantity. 15. Calculate the profit or loss at the profit maximizing price and quantity. Micro Problem Set 4