ECN 001A Lecture Notes - Lecture 15: Demand Curve, Natural Monopoly, Deadweight Loss

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18 Mar 2017

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ECN 001A Full Course Notes

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Monopoly: a firm that is the sole seller of a product w/o close substitutes. A monopoly firm has market power: the ability to influence the market price of the product it sells. Opposite of a competitive firm (has no market power) Main cause of monopolies: barriers to entry: other firms cannot enter the market. 3 sources of barriers to entry: a single firm owns a key resource. Debeers owns most of the world"s diamond mines: the govt gives a single firm the exclusive right to produce the good. Ex. patents, copyright laws: natural monopoly: a single firm can produce the entire market q at a lower cost than could several firms. Atc is lower if 1 firm services all 1000 homes, than if 2 firms each service 500 homes. Market demand curve slopes downward (on the s & d graph) But the d curve for any individual"s firm"s product is horizontal at the market price.

Related Questions

Use the following demand schedule for a monopolist to calculate total revenue and marginal revenue. For each price, indicate whether demand is elastic, unit elastic, or inelastic.

price (P)($)	Quantity demanded (Q)	Total Revenue	Marginal Revenue	Price Elasticity of demand (Ed)
5.00	0
4.50	1
4.00	2
3.50	3
3.00	4
2.50	5
2.00	6
1.50	7
1.00	8
0.50	9
0.00	10

beigefish857

Use the following demand schedule for a monopolist to calculate total revenue and marginal revenue. For each price, indicate whether demand is elastic, unit elastic, or inelastic.

Price (P)($)	Quantity demanded (Q)	Total Revenue	Marginal Revenue	Price Elasticity of demand (Ed)
5.00	0
4.50	1
4.00	2
3.50	3
3.00	4
2.50	5
2.00	6
1.50	7
1.00	8
0.50	9
0.00	10

beigefish857

Use the following demand schedule for a monopolist to calculate total revenue and marginal revenue. For each price, indicate whether demand is elastic, unit elastic, or inelastic. Using the data from the demand schedule, graph the demand curve, the marginal revenue curve, and the total revenue curve. Identify the elastic, unit elastic, and inelastic segments along the demand curve.

Price (P)	Quantity Demanded (Q)	Total Revenue	Marginal Revenue	Price elasticity of demand
$5.00	0
4.50	1
4.00	2
3.50	3
3.00	4
2.50	5
2.00	6
1.50	7
1.00	8
0.50	9
0	10

ivoryyak837

ECN 001A Lecture Notes - Lecture 15: Demand Curve, Natural Monopoly, Deadweight Loss

ECN 001A Full Course Notes

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