Earns a profit in the long run and short run 一个垄断企业如果不被regulated,它将会减少consumer surplus,增加它的producer surplus,CS的损失>PS的增加,因而导致Deadweight loss 因为在垄断企业选择的生产点时候,产出减少,所以有无谓损失,P>MC;价格大于边际成本;Thus,mutually beneficial transaction go unmade;因而...
24. During the life of a drug patent, the monopoly pharmaceutical firm maximizes profit by producing the quantity at which marginal revenue equals marginal cost. ANS: T DIF: 1 REF: 15-2 NAT: Analytic LOC: Monopoly TOP: Profit maximization MSC: Interpretive 25. The socially efficient quantity...
eBayandGooglearedominantplayersinthemarketstheyserve.Thesefirmsarenotlikethefirmsinperfectcompetition.Howdofirmsthatdominatetheirmarketsbehave?Studentsgetlotsofpricebreaks—atthemovies,hairdresser,andontheairlines.Why?Howcanitbeprofitmaximizingtoofferlowerpricestosomecustomers?MarketPower Marketpowerandcompetitionarethe...
a firm controls the supply of a unique resource. b. a firm has many small firms that they can control. c. there are firms which act together as a monopoly. d. the long-run average cost curve slopes downward until it crosses the demand curve. Answer: d 11. Which of the following is...
(i.e., no entry barrier), in the long run, market power is eliminated; P = MCEntries areimpededif post-entry profit < 02 perspectives of entry barrier:(1) corporate strategy – entry deterrence; (2) public policy[Example 4.1 Nintendo and Reynolds International Pen]Reynolds and Nintendo ...
In the short run the monopolist adjusts the level of output while working with a given existing plant. His profit- maximising output in the short run will be where only the short-run marginal cost curve (i.e., marginal cost curve with the existing plant) is equal to marginal ...
Market Expansion:Exploiting economies of scale to lower costs and increase profit margins. Regulation:Government intervention to prevent abuse of market power and protect consumer interests. Examples of Monopoly Utilities:Local electricity or water companies that are the sole providers in their regions. ...
In a competitive market, firms are price takers and will earn zero economic profit in the long run. True OR False. A monopoly firm is efficient. True False Perfect competition always provides a lower price than monopolistic competition or an oligopoly. a. true b. false ...
Compare the performance and efficiency of single-price monopoly and competition Explain how price discrimination increases profit Explain how monopoly regulation influences output, price, economic profit, and efficiency Dominating the Internet eBay and Google are dominant players in the markets they serve....
the supply-demand schedule that will maximize profit. In modern times, the accelerated production and competition brought about by the Industrial Revolution led to the formation of monopoly and oligopoly. Since the notion of monopoly is antithetical to the free market ideal, it has never been ...