Question

What is the shape of a monopolist’s demand curve and marginal revenue curve? Provide a simple...

What is the shape of a monopolist’s demand curve and marginal revenue curve? Provide a simple graph and an explanation.

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Ans) Monopoly is where there is single seller selling unique product. A monopolist faces a downward sloping demand curve and marginal revenue curve.

Demand curve is downward sloping because of diminishing marginal utility and hence to sell an additional unit, monopolist will have to lower the price, which makes marginal revenue to fall and hence marginal revenue curve is also downward sloping.

Further, marginal revenue curve of monopoly lies beneath the demand curve.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Find the monopolist’s marginal revenue curve given: a. Demand curve: QD = 50 – ½ P...
Find the monopolist’s marginal revenue curve given: a. Demand curve: QD = 50 – ½ P b. Inverse demand curve: P = 222 – 3QD
At a point on a demand curve where demand is inelastic, a monopolist’s marginal revenue is...
At a point on a demand curve where demand is inelastic, a monopolist’s marginal revenue is which of the following None of the other answers are true. equal to price times the slope of the demand curve. greater than price. less than zero. greater than one.
Explain why the monopolist’s demand and marginal revenue curves are not the same. Graphically show a...
Explain why the monopolist’s demand and marginal revenue curves are not the same. Graphically show a monopolist’s short-run profit-maximizing price and quantity. Explain what determines whether a firm is a price taker or a price searcher. 

The following equations describe the monopolist’s demand, marginal revenue, total cost and marginal cost: Demand: Qd...
The following equations describe the monopolist’s demand, marginal revenue, total cost and marginal cost: Demand: Qd = 12 – 0.25P | Marginal Revenue: MR = 48 – 8Q | Total Cost: TC = 2Q^2 | Marginal Cost: MC = 4Q Where Q is quantity and P is the price measured in dollars. a) What is the profit maximizing monopoly’s quantity and price? b) At that point, calculate the price elasticity of demand. What does the value imply? c) Does this...
Suppose that the monopolist’s demand is: P = 10 – Q, so that marginal revenue is:...
Suppose that the monopolist’s demand is: P = 10 – Q, so that marginal revenue is: MR = 10 – 2Q. The marginal cost is: MC = 2, and total fixed cost = 0. a. Determine the profit maximizing price and output. b. Calculate the amount of economic profit or loss at the profit maximizing output. c. Calculate the price elasticity of demand at the profit maximizing point and explain it. use relevant diagram to answer the question
What is the difference between a monopolist’s demand curve and a perfectly competitive firm’s demand curve?...
What is the difference between a monopolist’s demand curve and a perfectly competitive firm’s demand curve? Why are they different?
What is the difference in the explanation of the shape of the aggregate demand curve (AD)...
What is the difference in the explanation of the shape of the aggregate demand curve (AD) and a single product demand curve (D)?  After all, both demand curves show an inverse relationship between price and quantity?  What is the difference in the explanation of the shape of the Short Run Aggregate Supply Curve (SRAS) and Long Run Aggregate Supply Curve (LRAS)?
(a) Explain the difference between average, total, and marginal revenue? What is the shape of the...
(a) Explain the difference between average, total, and marginal revenue? What is the shape of the total and marginal revenue curves for the individual perfectly competitive firm? [5marks] (b) Why does price equal marginal revenue for the perfectly competitive firm? What is the relationship to the demand curve for the firm? [5marks] (c) Why is the level of output at which marginal revenue equals marginal cost the profitmaximizing output? [5marks] (d) What conditions are necessary to determine if the purely...
Under perfect competition, the demand curve facing a firm and the firm's marginal revenue curve are...
Under perfect competition, the demand curve facing a firm and the firm's marginal revenue curve are a. vertical at the firm's chosen output level b. both vertical, but the demand curve is further to the right than the marginal revenue curve c. both vertical, but the marginal revenue curve is further to the right than the demand curve d. both horizontal, but the demand curve is above the marginal revenue curve e. both horizontal at the level of the market...
4.Which statement isincorrect? a.A pure monopolist’s demand curve is the market demand curve. b.A monopoly produces...
4.Which statement isincorrect? a.A pure monopolist’s demand curve is the market demand curve. b.A monopoly produces a product for which there are no close substitutes. c.Marginal revenue is less than price for a monopolist that cannot price discriminate. d.A monopolist’s market position ensures positive economic profits. 5.For a firm with monopoly power that cannot engage in price discrimination: a.the marginal revenue curve lies below the demand curve because any reduction in price applies only to the last unit sold. b.the...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT