____ occurs when price‐ and quantity‐fixing agreements among producers are undeclared. a) Tacit collusion b) Strategic collusion c) Oligopoly d) Monopolistic competition
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____ occurs when
a) Tacit collusion
b) Strategic collusion
c) Oligopoly
d)
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- (a) Consider a monopoly trading firm that dominates a particular market. Describe the factors that contribute to the monopoly's ability to control prices and generate profits and as such discuss its short run and long run profit situation. Use relevant diagrams to support your answer.(b) Suppose more firms are interested in joining the market and over the years, the market structure is characterised by monopolistic competition. Discuss the implication on the firm's short-run and long run profits. Use relevant diagrams to support your answer.-------- occurs when price and quantity fixing agreements amoung producers are uncleared a)tacit collusion b) monopolistic competition c) oligopoly d)strategic collusionMonopolistic Competition Consider the folowing graph, (graph 1) for the short run equilibrium for a monopolisticaily competitive firm producing printers for commercial operations. Graph1 $ Price per unit P1 ATC MC P2 Pa D3 D2 D3 Q2 Qu Q3 Quantity MR2 MR. The following information is given: D1 = $35,000- $15Q TC = $550,000+ $1,000Q+ $10Q? Answer the following and referring to the relevant elements of graph 1 above and show all workings. (a) Calculate price output and profit for the short run equilibrium (show all workings). (b) Calculate price, output and profit for the long run equilibrium (with and without product differentiation) (show all workings). (c) Is the market allocatively efficient in the short run or long run (why or why not?). (d) Is the market productively efficient in the short run or long run (why or why not?).
- Suppose a country's mobile phone industry is supplied by only two firms (i.e. an oligopoly). Explain how the presence of two firms affects the price elasticity of demand of each firm's output.1. Consider the (inverse) market demand function for the market in streaming services. P = 120 - 4Q Assume further that the available technology results in Marginal Cost equal to $40. a) Graphically show the market outcome for monopoly, Cournot oligopoly and perfect competition. b) For monopoly, Cournot duopoly and perfect competition determine the optimal outcome. Clearly explain how you arrive at your answer. What are the market price and quantity under each market structure? c) What are the consumer surplus, producer surplus and total surplus under each scenario? d) Show the reaction function under Bertrand competition. What are the associated price and quantity?In the short run, each of the 5 firms in some industry faces a capacity constraint and constant marginal and average costs until this capacity is reached (see the table below). Marginal Cost = Average Cost Maximum output Firm 1 $50 100 Firm 2 $60 20 Firm 3 $67 50 Firm 4 $80 200 Firm 5 $92 70 Assuming that no firm has monopoly (pricing) power, what will be the quantity supplied at a price of (a) $40 (b) $55 (c) $73 (d) $99
- The market for corn in Brazil has a large number of sellers and there is no difference in the products sold by each seller. As there are also a large number of buyers for corn, the actions of a single seller or buyer cannot affect the price. The market for corn in Brazil can be described as ____. monopolistic competition pure competition an oligopoly a monopoly modified competitionConsidering the slope of the perceived demand curves faced by the firms in the four market structures,____________ we can list (most elastic). A) price competitive, quantity competitive, non-price competitive, product differentiation. B) oligopolist, perfectly competitive, monopoly, monopolistically competitive. C) perfectly competitive, oligopoly, monopolistic competitive, perfectly competitive . D) monopolist, oligopolist, monopolisitcally competitive, perfectly competitive demand curves reflect that firm's ability raise its price without losing all of its customers.Suppose you are employed at a monopolistic company as a research (pricing) economist and you are deriving the behavior of two markets based on demand curves given by: Di(P1) 3 50 — Pі D:(p>) — 50 — 2р2 Assume that the marginal cost is constant at $8 a unit. (a) If it can price discriminate, what price should it charge in each market in order to maximize profits? (b) If it can't price discriminate, what price should it charge?
- COURSE: MICROECONOMICS LEVEL 2 COURSE: MICROECONOMICS LEVEL 2 Consider a company A operating in an oligopoly which has a market share of 20% and a unit cost of $50. It currently sells at a price (P) of $52.9 with a price elasticity of demand of -3.5. This company will merge with company D, so that market share will reach 50%. Estimate impact of this operation on selling price under 2 scenarios:(a) With economies of scale, given the merger. Cost reduction of 15%.b) Without economies of scale, constant cost of 50%.c) How much does market power of merged company change, considering with and without economies of scale?Table 17-4 Only two firms, ABC and XYZ, sell a particular product. The following table shows the demand curve for their product. Each firm has the same constant marginal cost of $8 and zero fixed cost. Price Quantity Total Demanded Revenue (Dollars per unit) (Units) (Dollars) 28 26 130 24 10 240 22 15 330 20 20 400 18 25 450 16 30 480 14 35 490 12 40 480 10 45 450 8 50 400 55 330 4 60 240 2 65 130 70 Refer to Table 17-4. If this market were perfectly competitive instead of oligopolistic, what quantity would be produced? а. 25 b. 50 С. 35 d. 70 O O O ODo you expect that an increase in the price of a product generates a larger decrease in quantity demanded for a monopolistically competitive firm than it would for a monopoly? a/ yes; consumers will buy from competitors offering lower priced substitutes b/ no; conditions of imperfect competition means demand is constant c/ no; a monopolistic competitor perceives demand as a price maker d/ yes; but temporarily because price increases only create a short-run decline