Micro HW Chapters 13-14
mimo_doll
hw_6_chapters_13-14_spring_2016.docx
QUESTION 1
1. In an imperfectly competitive industry,
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A) a single firm has no control over the price of its output.
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B) a single firm has some control over the price of its output. |
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C) a single firm will be able to sell all of its output at whatever price it wants to charge. |
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D) the government will always regulate the output price.
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10 points
QUESTION 2
1. Monopolies, oligopolies, and monopolistic competitive industries all
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A) earn positive profits in the long run.
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B) have market power.
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C) are completely unconstrained in their pricing.
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D) raise price and quantity over what would occur in perfect competition in order to maximize their profits. |
10 points
QUESTION 3
1. Imperfect competition and market power
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A) are major sources of inefficiency.
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B) result in higher output than in perfect competition.
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C) are always the result of product differentiation.
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D) result from diseconomies of scale. |
10 points
QUESTION 4
1. Stereo Sound Unlimited has a monopoly over the installation of surround sound systems. If Stereo Sound Unlimited's total revenue from installing 10 sound systems is $20,000 and its total revenue from installing 11 sound systems is $18,000, what is the marginal revenue of the eleventh sound system?
10 points
QUESTION 5
1. Hi Phi Sound Unlimited has a monopoly over the installation of surround sound systems. If Hi Phi Unlimited's total revenue from installing 15 sound systems is $30,000 and its total revenue from installing 18 sound systems is $33,000, what is the marginal revenue of the eighteenth sound system?
10 points
QUESTION 6
1.
Use the following diagram to answer questions (6)-(8).
The profit-maximizing level of output for this firm is
10 points
QUESTION 7
1. The monopoly price of the good at the profit-maximizing level of output for this firm is
10 points
QUESTION 8
1. If this firm is producing the profit-maximizing quantity and selling it at the profit-maximizing price, the firm's revenues will be
10 points
QUESTION 9
1. A form of industry structure characterized by a few firms each large enough to influence market price is
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A) perfect competition.
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B) monopolistic competition.
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C) oligopoly.
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D) monopoly. |
10 points
QUESTION 10
1. Use the following information to answer questions (10)-(12).
Consider a monopoly facing a market demand corresponding to the equation: $150-0.6*Q, where P is the price level and Q is the total supply to the market. The production function of the technology operates according to: q=60+15*ln(w), where w is the unit of labor employed and q the level of production. The total cost of production follows equation: TC= q+q2. The following table summarizes the market conditions and the monopoly’s production technology and cost structure.
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Workers
(w) |
q = |
P= |
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TC = q+q2 |
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60+ 15*ln(w) |
$150- 0.6*Q |
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0.05 |
15 |
$141.00 |
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$240 |
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0.1 |
25 |
$135.00 |
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$650 |
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0.135 |
30 |
$132.00 |
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$930 |
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0.185 |
35 |
$129.00 |
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$1,260 |
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0.235 |
38 |
$127.20 |
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$1,482 |
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0.285 |
41 |
$125.40 |
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$1,722 |
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0.335 |
44 |
$123.60 |
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$1,980 |
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0.385 |
46 |
$122.40 |
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$2,162 |
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0.435 |
48 |
$121.20 |
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$2,352 |
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0.485 |
49 |
$120.60 |
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$2,450 |
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0.53 |
50 |
$120.00 |
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$2,550 |
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0.58 |
52 |
$118.80 |
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$2,756 |
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0.63 |
53 |
$118.20 |
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$2,862 |
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0.68 |
54 |
$117.60 |
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$2,970 |
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0.73 |
55 |
$117.00 |
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$3,080 |
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0.78 |
56 |
$116.40 |
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$3,192 |
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0.83 |
57 |
$115.80 |
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$3,306 |
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0.88 |
58 |
$115.20 |
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$3,422 |
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What is the monopoly’s profit maximizing level of production?
10 points
QUESTION 11
1. What is the monopoly’s average total cost at the profit maximizing level of production?
10 points
QUESTION 12
1. What is the monopoly’s revenue at the profit maximizing level of production?
10 points
