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PRINCIPLES OF ECONOMICS 5 Due date: 1.Angelo is a wholesale meatball distributor. He sells his meatballs to all the finest Italian restaurants in town. Nobody can make meatballs like Angelo. As a result, this is the only business in town that sells meatballs to restaurants. Assuming that Angelo is maximizing his profit, which of the following statements is true? a.Meatball prices will be less than marginal cost. b.Meatball prices will equal marginal cost. c.Meatball prices will exceed marginal cost. d.Meatball prices will be a function of supply and demand and will therefore oscillate around marginal costs. 2. Which of the following statements is (are) true of a monopoly? (i)A monopoly has the ability to set the price of its product at whatever level it desires. (ii)A monopoly's total revenue will always increase when it increases the price of its product. (iii)A monopoly can earn unlimited profits. a.(i) only b.(ii) only c. (i) and (ii) d.(ii) and (iii) 3.Which of the following is an example of a barrier to entry? (i)A key resource is owned by a single firm. (ii)The costs of production make a single producer more efficient than a large number of producers. (iii)The government has given the existing monopoly the exclusive right to produce goods. a.(i) and (ii) journal article Monopolistic Competition with Outside GoodsThe Bell Journal of Economics Vol. 10, No. 1 (Spring, 1979) , pp. 141-156 (16 pages) Published By: RAND Corporation https://doi.org/10.2307/3003323 https://www.jstor.org/stable/3003323
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Abstract The Chamberlinian monopolistically competitive equilibrium has been explored and extended in a number of recent papers. These analyses have paid only cursory attention to the existence of an industry outside the Chamberlinian group. In this article I analyze a model of spatial competition in which a second commodity is explicitly treated. In this two-industry economy, a zero-profit equilibrium with symmetrically located firms may exhibit rather strange properties. First, demand curves are kinked, although firms make "Nash" conjectures. If equilibrium lies at the kink, the effects of parameter changes are perverse. In the short run, prices are rigid in the face of small cost changes. In the long run, increases in costs lower equilibrium prices. Increases in market size raise prices. The welfare properties are also perverse at a kinked equilibrium. Publisher Information The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND focuses on the issues that matter most such as health, education, national security, international affairs, law and business, the environment, and more. With a research staff consisting of some of the world's preeminent minds, RAND has been expanding the boundaries of human knowledge for more than 60 years. Rights & Usage This item is part of a JSTOR Collection. What price does a monopolistically competitive firm charge?A monopolistic competitive firm's demand curve is downward sloping, which means it will charge a price that exceeds marginal costs. The market power possessed by a monopolistic competitive firm means that at its profit maximizing level of production there will be a net loss of consumer and producer surplus.
When a market is monopolistically competitive the typical firm in the market can earn quizlet?When a market is MONOPOLISTICALLY COMPETITIVE, the typical firm in the market is likely to experience a: POSITIVE/NEGATIVE profit in the SHORT RUN and ZERO profit in the LONG RUN. If firms in a MONOPOLISTICALLY COMPETITIVE FIRM market are earning positive profits, then: NEW firms will ENTER the market.
When a profit maximizing firm in a monopolistically competitive market charges a price higher than marginal cost?firm's economic profit is zero. When a profit-maximizing firm in a monopolistically competitive market is in long-run equilibrium, price exceeds marginal cost. chosen a quantity of output where average revenue equals average total cost.
What output quantity will the monopolistically competitive firm produce to maximize profits quizlet?A profit-maximizing monopoly should follow the rule of producing up to the quantity where marginal revenue is equal to marginal cost, that is, MR=MC. For this firm, that output quantity is 30, where both marginal revenue and marginal cost equal $100.
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Refer to figure 16-2. what price will the monopolistically competitive firm charge in this market?
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