Answer the next question based on the following demand and cost data faced by a pure monopoly.Demand DataCost DataPriceQuantity DemandedOutputTotal Cost$2.7533$4.002.50444.502.25554.752.00665.751.75777.75At equilibrium, the pure monopoly will generate_____.
A. an economic profit of $6.50
B. an economic profit of $10
C. a loss of $7.25
D. an economic profit of $4.50
Answer: A
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an announcement that the "beginning stocks" of corn were higher than expected is an indication that:
a) prices would be expected to decrease more than previously expected b) prices would be expected to increase more than previously expected c) there is no effect on prices: stocks are unrelated to the level of future prices
Joaquin's marginal utility from an additional slice of pumpkin pie is 4 utils and his marginal utility from an additional slice of pecan pie is 6 utils. If a slice of pumpkin pie costs $2.50, and a slice of pecan pie costs $3.00, then Joaquin:
A. should reallocate his spending towards pecan pie and away from pumpkin pie. B. should reallocate his spending towards pumpkin pie and away from pecan pie. C. is maximizing his utility. D. should spend more on pumpkin pie and more pecan pie.
Rent, after the change in demand from D/1 to D/2, would be
A. $1,500.
B. $1,000.
C. $500.
D. impossible to determine with the information available.
You are the manager of a firm that sells its product in a competitive market at a price of $60. Your firm's cost function is C = 50 + 3Q2. Your firm's maximum profits are:
A. 450. B. 250. C. 400. D. 500.