Monopoly

PLEASE SHOW ALL YOUR WORK FOR ALL THE FOLLOWING QUESTIONS:

Question #1: Consider a monopolist with the (inverse) demand function: Pb = 112 - 6 Qb.

Given a (constant) marginal cost of $ 13 , how much will the monopolist produce ?

(Assume fixed costs = 19 and AVC = MC.)

Question #2: Consider a monopolist with the (inverse) demand function: Pb = 112 - 6 Qb.

Given a (constant) marginal cost of $ 13 , what price will the monopolist charge ?

(Assume fixed costs = 19 and AVC = MC.)

Question #3: Consider a monopolist with the (inverse) demand function: Pb = 112 - 6 Qb.

Given a (constant) marginal cost of $ 13 , how much producer surplus is created ?

(Assume fixed costs = 19 and AVC = MC.)

Question #4: Consider a monopolist with the (inverse) demand function: Pb = 112 - 6 Qb.

Given a (constant) marginal cost of $ 13 , how much profit does the monopolist earn ?

(Assume fixed costs = 19 and AVC = MC.)

Question #5: Consider a monopolist with the (inverse) demand function: Pb = 112 - 6 Qb.

Given a (constant) marginal cost of $ 13 , how much DWL is created ?

(Assume fixed costs = 19 and AVC = MC.)

Question #6: Consider a monopolist with the (inverse) demand function: Pb = 112 - 6 Qb.

Given a (constant) marginal cost of $ 13 , how much CS is there under monopoly ?

(Assume fixed costs = 19 and AVC = MC.)

Question #7: Consider a monopolist with the (inverse) demand function: Pb = 112 - 6 Qb.

Given a (constant) marginal cost of $ 13 , how much CS would be created if the market was competitive?

(Assume fixed costs = 19 and AVC = MC.)

Question #8: Consider a monopolist with the (inverse) demand function: Pb = 141 - 8 Qb.

Given an increasing marginal cost: mc = 19 + 5 Q, how much will the monopolist produce ?

(Assume fixed costs = 16 .)

Question #9: Consider a monopolist with the (inverse) demand function: Pb = 141 - 8 Qb.

Given an increasing marginal cost: mc = 19 + 5 Q, what price will the monopolist charge ?

(Assume fixed costs = 16 .)

Question #10: Consider a monopolist with the (inverse) demand function: Pb = 141 - 8 Qb.

Given an increasing marginal cost: mc = 19 + 5 Q, how much producer surplus is created ?

(Assume fixed costs = 16 .)

Question #11: Consider a monopolist with the (inverse) demand function: Pb = 141 - 8 Qb.

Given an increasing marginal cost: mc = 19 + 5 Q, how much profit does the monopolist earn ?

(Assume fixed costs = 16 .)

Question #12: Consider a monopolist with the (inverse) demand function: Pb = 141 - 8 Qb.

Given an increasing marginal cost: mc = 19 + 5 Q, how much DWL is created ?

(Assume fixed costs = 16 .)

Question #13: Consider a monopolist with the (inverse) demand function: Pb = 141 - 8 Qb.

Given an increasing marginal cost: mc = 19 + 5 Q, how much CS is there under monopoly ?

(Assume fixed costs = 16 .)

Question #14: Consider a monopolist with the (inverse) demand function: Pb = 141 - 8 Qb.

Given an increasing marginal cost: mc = 19 + 5 Q, how much CS do consumers lose because of the monopoly ?

(Assume fixed costs = 16 .)

Question #15: Consider a monopoly cartel with two firms, the firms face an (inverse) demand function: Pb = 216 - 10 Qb.

The marginal cost for firm 1 is given by mc1 = 49 + 8 Q.

The marginal cost for firm 2 is given by mc2 = 117 + 5 Q.

What is the slope of the cartel's joint marginal cost function when both firm's are producing ?

Question #16: Consider a monopoly cartel with two firms, the firms face an (inverse) demand function: Pb = 216 - 10 Qb.

The marginal cost for firm 1 is given by mc1 = 49 + 8 Q.

The marginal cost for firm 2 is given by mc2 = 117 + 5 Q.

What is the intercept of the cartel's joint marginal cost function ?

Question #17: Consider a monopoly cartel with two firms, the firms face an (inverse) demand function: Pb = 216 - 10 Qb.

The marginal cost for firm 1 is given by mc1 = 49 + 8 Q.

The marginal cost for firm 2 is given by mc2 = 117 + 5 Q.

How much output will the cartel produce ?

Question #18: Consider a monopoly cartel with two firms, the firms face an (inverse) demand function: Pb = 216 - 10 Qb.

The marginal cost for firm 1 is given by mc1 = 49 + 8 Q.

The marginal cost for firm 2 is given by mc2 = 117 + 5 Q.

How much output will firm 1 produce as part of the cartel ?

Question #19: Consider a monopoly cartel with two firms, the firms face an (inverse) demand function: Pb = 216 - 10 Qb.

The marginal cost for firm 1 is given by mc1 = 49 + 8 Q.

The marginal cost for firm 2 is given by mc2 = 117 + 5 Q.

How much output will firm 2 produce as part of the cartel ?

Question #20: Consider a monopoly cartel with two firms, the firms face an (inverse) demand function: Pb = 216 - 10 Qb.

The marginal cost for firm 1 is given by mc1 = 49 + 8 Q.

The marginal cost for firm 2 is given by mc2 = 117 + 5 Q.

How much profit will firm 2 earn as part of the cartel (assume fixed cost for the firm are $100) ?