Answer the next question based on the demand and cost schedules for a monopolistically competitive firm given in the table below. Price Quantity Demanded Total Cost Output$20 1 $10 118 2 20 216 3 29 314 4 36 412 5 40 510 6 42 6 What output quantity will the monopolistically competitive firm produce to maximize profits?

Answer the next question based on the demand and cost schedules for a monopolistically competitive firm given in the table below. Price Quantity Demanded Total Cost Output$20 1 $10 118 2 20 216 3 29 314 4 36 412 5 40 510 6 42 6  What will be the economic profit or loss for this monopolistically competitive firm at the profit-maximizing level of output?Multiple Choice−$15+$10+$20+$28

1. The table below describes the market situation of a monopolist. The first two columnsdescribe price and quantity as taken from the demand curve the monopolist faces. Thethird column provides the monopolist’s total cost of producing the given quantity.The monopoly may only produce whole units of output (no fractions of Q).Price Quantity Total Cost50 20 54049 21 56548 22 59047 23 61546 24 640a.* What is the profit maximizing quantity for the monopolist? What price will the monopolistcharge? (Hint: Add columns for total revenue, marginal revenue and marginal cost.)b.* What profit will the monopolist make, given your answer to part a.?c. Suppose that instead of the total cost given in the table above, the monopolist had a constantmarginal cost of $28 (and faced the same demand curve). What would be the profitmaximizing quantity for the monopolist?2Use figure 1 at right to answer question 2.Use the letters to describe the areas associatedwith the concepts below. (i.e. rectangle BCFE)There is no price discrimination in this market.2. a.* If this market is a monopoly, what would consumer surplus be?b.* If this market is a monopoly, what would firm profit be?c. If this market is perfectly competitive (in long run equilibrium), whatwould consumer surplus be?d. If this market is perfectly competitive (in long run equilibrium), whatwould firm profit be?e.* If this market is a monopoly, what would the dead weight loss be?3. One approach to regulating monopolies has been to break the monopoly up into smallercomponent firms, as in the case of antitrust actions against the railroads in the early 1900’s.Would you recommend this approach for a natural monopoly? Discuss why or why not.IAC = MCC H$GDemandMRADBQFEFigure 134. Consider the payoff matrix for a two firm game depicted above.a.* What is the optimal outcome for the firm’s profits considered together? (This is the“socially optimal” outcome.)b.* Is there a dominant strategy equilibrium in this game? If so, what is it?c.* Describe how these outcomes relate to the oligopoly pricing problem described in class.Which outcome coincides with “cheating”? Which outcome represents “cooperation”d. If firms play this game, what do you expect will happen? Please briefly explain why.5. Consider the following types of market organization in answering this question:long run perfect competition, long run monopolistic competition, two firm oligopoly(duopoly) which is successfully cooperating and monopoly.a.* Order the firms from smallest to largest long run profit. Please provide a brief explanation.b.* Order the firms from smallest to largest price to the consumer.c. Discuss the efficiency of each type of market organization.Strategy 1Strategy 2B = 30A = 30B = 40A = 0B = 0A = 40B = 10A = 10Firm AFirm BStrategy 2StrategyQuestion 1. a.* What is the profit maximizing quantity for the monopolist? (Hint: Add columns for total revenue, marginal revenue and marginal cost.)Group of answer choicesquantity = 20quantity = 21quantity = 22quantity = 23quantity = 24Question 1. b.*  What profit will the monopolist make, given your answer to part a.?Group of answer choicesprofit = 0profit = 460profit = 464profit = 466profit = 476Question 2. a.* If this market is a monopoly, what would consumer surplus be?Group of answer choicesarea ABEarea ACHarea EFHarea BCFEarea CDGFarea BCHEQuestion 2. b.* If this market is a monopoly, what would firm profit be?Group of answer choicesarea ABEarea ACHarea EFHarea BCFEarea CDGFarea BCHEQuestion 2. e.* If this market is a monopoly, what would the dead weight loss be?Group of answer choicesarea ABEarea ACHarea EFHarea BCFEarea CDGFarea BCHEQuestion 4.a. What is the optimal outcome for the firm’s profits considered together?  (This is the “socially optimal” outcome.)Group of answer choicesFirm A plays strategy 1, firm B plays strategy 1Firm A plays strategy 1, firm B plays strategy 2Firm A plays strategy 2, firm B plays strategy 1Firm A plays strategy 2, firm B plays strategy 2Question 4.b.  Is there a dominant strategy equilibrium in this game? If so, what is it?Group of answer choicesFirm A plays strategy 1, firm B plays strategy 1Firm A plays strategy 1, firm B plays strategy 2Firm A plays strategy 2, firm B plays strategy 1plays strategy 2, firm B plays strategy 2Question 4.c.  Describe how these outcomes relate to the oligopoly pricing problem described in class.Which outcome represents “cooperation”?Group of answer choicesFirm A plays strategy 1, firm B plays strategy 1Firm A plays strategy 1, firm B plays strategy 2Firm A plays strategy 2, firm B plays strategy 1Firm A plays strategy 2, firm B plays strategy 2Question 5.a. Order the firms from smallest to largest long run profit.Group of answer choicesMonopolistic Competition, Monopoly, Perfect Competition, One firm in a cooperating DuopolyPerfect Competition, Monopoly, Monopolistic Competition, One firm in a cooperating DuopolyOne firm in a cooperating Duopoly, Perfect Competition, Monopoly, Monopolistic CompetitionPerfect Competition, Monopolistic Competition, One firm in a cooperating Duopoly, MonopolyQuestion 5.b. Order the firms from smallest to largest price to the consumer.Group of answer choicesMonopolistic Competition, Perfect Competition, Monopoly, One firm in a cooperating DuopolyPerfect Competition, Monopoly, Monopolistic Competition, One firm in a cooperating DuopolyOne firm in a cooperating Duopoly, Perfect Competition, Monopoly, Monopolistic CompetitionPerfect Competition, Monopolistic Competition, One firm in a cooperating Duopoly, Monopoly

Table 9.3. Quantity Price(dollars)Total Revenue(dollars)Total Variable Cost(dollars)Total Cost(dollars) 0 21 0 050 1 20 20 16 66 2 19 38 31 81 3 18 54 45 95 4 17 68 59109 5 16 80 75125 6 15 90 93143 7 14 98112162 8 13104140190 9 12108180230 10 11110230280 Table 9.3 shows the demand and cost schedules for a monopolistically competitive firm.Refer to Table 9.3. What is the best course of action for the firm in the short run?  It should not cut its price, but it should increase its sales by advertising. You Answered  It should increase its sales by lowering its price.   It should shut down. Correct answer  It should stay in business because it covers some of its fixed cost.

The table below shows the demand and marginal cost information for a monopolist with a constant marginal cost. Monopoly MarketPrice (dollars) Quantity Demanded Marginal Revenue (dollars) Marginal Cost (dollars)$220 0 — —200 40 $200 $120180 80 160 120160 120 120 120140 160 80 120120 200 40 120100 240 0 120 Instructions: Enter your answers as a whole number. a. For the monopolist, the profit-maximizing price is $ and the profit-maximizing quantity is . b. For the monopolist, the allocatively efficient price is $ and the allocatively efficient quantity is .

Use the following table to answer the next question.  The table shows the total costs associated with varying levels of output produced by a perfectly competitive firm. Output Total Cost0 $1,4001 1,6002 2,0003 2,6004 3,5005 4,800 If the product sells for $800 a unit, the firm's profit-maximizing output isMultiple Choice2.3.4.