Class Notes (837,284)
Canada (510,219)
ECON 208 (210)

Chapter 10.docx

1 Page
Unlock Document

Economics (Arts)
ECON 208
Sebastien Forte

Chapter 10: Monopolys, Cartels, and Price Discrimination  For monopolists, marginal revenue is less than price  If the monopolist produces too much, he would need to charge a lower price for Qd to match Qs  A monopolist faces a downward sloping market demand curve (different from in a perfectly competitive market where they faced a horizontal demand curve)  If the monopolist charges the same price for all units sold, its total revenue (TR) is: TR = p x Q  ^Regularily is is (TR = p x q). This is a capital Q because he has to think about the whole market quantity, not just his own (market quantity is his own)  Marginal Revenue (MR) is the revenue resulting from the sale of an additional unit of production: MR = ΔTR/ΔQ  The monopolist must reduce the price to increase its sales- therefore the MR curve is below the demand curve  MR curve- same intercept and twice the slope of the demand curve  Profit maximizing point is lower than minimum average cost po
More Less

Related notes for ECON 208

Log In


Join OneClass

Access over 10 million pages of study
documents for 1.3 million courses.

Sign up

Join to view


By registering, I agree to the Terms and Privacy Policies
Already have an account?
Just a few more details

So we can recommend you notes for your school.

Reset Password

Please enter below the email address you registered with and we will send you a link to reset your password.

Add your courses

Get notes from the top students in your class.