The cost data and market demand schedule below are for a monopolistic firm. D. I

Question

The cost data and market demand schedule below are for a monopolistic firm.

D. Is the monopoly outcome productively efficient? Explain 


E. Is the monopoly outcome allocatively efficient? Explain.   

The cost data and market demand schedule below are for a monopolistic firm. A. Complete the total revenue and marginal revenue columns. B. Give the profit-maximizing price and quantity for the monopolistic firm. C. What is the monopolist?s profit or loss? D. Is the monopoly outcome productively efficient? Explain E. Is the monopoly outcome allocatively efficient? Explain.

Explanation / Answer

I will list your answers in order A. TR MR 0 95 5 180 5 255 5 320 5 375 5 420 5 455 5 480 5 495 5 500 5 B. In this case, the profit maximizing condition is when P=50 ad Q=10. This allows for the most revenue of 500. If we produce more, we have diminsing returns C. A monopolist is a person, group or organization with a monopoly. In other words, an individual or company that controls all of the market for a particular good or service. D. No it is not efficient. In fact is causes a dead wieght loss to society. This because they intentially produce a lower quantity than the market demands in order to charge a higher price. E. For the monopoly it is. They enjoy the higher returns with less capital and labor put in. The market/consumers however, are the ones hurt and demand a higher wuanntity and are willing to pay for it, just not at the price the monopolist is charging. Hope this helps

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.