MGEA02H3 Study Guide - Quiz Guide: Natural Monopoly, Economic Equilibrium, Marginal Cost

• School: UTSC
• Department: Economics for Management Studies
• Course: MGEA02H3
• Professor: Jack Parkinson

Document Summary

Mgea02 introduction to microeconomics: a mathematical approach. Topic 9 (week of nov 7) - monopoly. Coverage: the polar opposite of a perfectly competitive market is a monopolistic one. Monopoly is defined, the demand situation facing a monopolistic firm is clarified, and we examine how a monopoly will make price and output decisions to maximize profits. Taking the point of view of society as a whole (and using the concepts of consumer surplus and producer surplus), we can compare the results of business decisions made in perfectly competitive and monopolistic market structures. This economic theory is the foundation of public policies towards a number of important industries. Public policy may strive to regulate the behaviour of industries that do not operate in the public interest; we discuss the pros and cons of these regulatory efforts. Recommended reading: part of chapter 13 monopoly (pp. Do all the check your understanding questions within the parts of the text in the assigned readings.