Give only typing answer with explanation and conclusion The market demand for a monopoly firm is estimated to be: Qd = 100,000 - 500P + 2M + 500PR where Qd is quantity demanded, P is price, M is income, and PR is the price of a related good. The manager has forecasted the values of M and PR will be $50,000 and $20, respectively, in 2016. The average variable cost function is estimated to be AVC = 520 - 0.03Q + 0.000001Q2 Total fixed cost in 2016 is expected to be $4 million. The profit-maximizing price for 2016 is $80. $100. $260. $520. $560.
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Give only typing answer with explanation and conclusion
The market demand for a
Qd = 100,000 - 500P + 2M + 500PR
where Qd is quantity demanded, P is price, M is income, and PR is the price of a related good. The manager has
AVC = 520 - 0.03Q + 0.000001Q2
Total fixed cost in 2016 is expected to be $4 million. The profit-maximizing price for 2016 is
$80.
$100.
$260.
$520.
$560.
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- The Poster Bed Company believes that its industry can best be classified as monopolistically competitive. An analysis of the demand for its canopy bed has resulted in the following estimated demand function for the bed: P = 1,265-9Q The cost analysis department has estimated the total cost function for the poster bed as TC = -15Q3 +5Q +24,000 Short-run profits are maximized when the level of output is The total profit at this price-output level is The point price elasticity of demand at the profit-maximizing level of output is The level of fixed costs the firm is experiencing on its bed production is What is the impact of a $5,000 increase in the level of fixed costs on the price charged, output produced, and profit generated? Price Charged Output Produced Profits Generated Increase No change Decrease O O and the price is $ O OYou are a manager at Boston Brew'ns, the official microbrewery of the Boston Bruins. Applying what you learned at Cal State East Bay prior to moving to the east coast, you have estimated the cost function for brewing beer to be c(Q) = 2+Q+Q². Further, you have estimated the elasticity of demand for your signature beer, finding it to be ε =-1.5. Your firm has some price setting power because you and the other breweries in town offer differentiated products. The firm is currently charging a price of $6 per beer and selling 100 beers. Is this a profit-maximizing price? Explain. Should you increase or decrease the markup? Explain.Coastal Soda Sales has been granted exclusive market rights to the upcoming Beaufort Seafood Festival. This means that during the festival Coastal will have a monopoly, and it is anxious to take advantage of this position in its pricing strategy. The daily demand function is p = 2 – 0.0004x and the daily total cost function is C(x) = 500 + 0.2x + 0.0001x² where x is the number of units. (a) Determine Coastal's total revenue, R(x), and profit functions, P(x), in dollars. R(x) = P(x) (b) What profit-maximizing price per soda should Coastal charge? $ per soda How many sodas per day would expect to sell at this price? sodas per day What would be the daily profits? $ per day (c) If the festival organizers wanted to set an economically efficient price of $1.25 per soda, how would this change the results from part (b)? (Round your answer for daily profits to the nearest cent.) sodas per day it would expect to sell sodas per day daily profits per day Would Coastal be willing to provide sodas…
- Assume that Hydro One is the sole electricity distributor in Ontario, i.e. the market for distributing electricity is an actual monopoly. The demand of electricity is given by P 250,000 – 3Q where Q the quantity is measured in Gigawatt-hour (GWh). The price is measured in dollars per GWh. The total cost of Hydro One is given by: Cost = 100 Q? + 90,000Q + 1,500,000,000 a. Distinguish between natural and legal monopolies. Is Hydro One legal or natural monopoly? Explain your answer. b. Draw the marginal revenue curve for Hydro One. c. Determine the profit maximizing level of output for Hydro One. d. What is the selling price of electricity that Hydro One should charge? Compute its profit at this price. Can Hydro One sustain this profit over long term? e. Compute the deadweight loss resulting from the monopoly.The Poster Bed Company believes that its industry can best be classified as monopolistically competitive. An analysis of the demand for its canopy bed has resulted in the following estimated demand function for the bed:P = 1760 - 12QThe cost analysis department has estimated the total cost function for the poster bed asTC = (1/3)Q3 - 15Q2 + 5Q + 24,000a. Calculate the level of output that should be produced to maximize short-run profits. b. What price should be charged? c. Compute total profits at this price-output level. d. Compute the point price elasticity of demand at the profit-maximizing level of output. e. What level of fixed costs is the firm experiencing on its bed production? f. What is the impact of a $5,000 increase in the level of fixed costs on the price charged, output produced, and profit generated?Assume that Gas & Minerals is the only copper mining firm in Chile. The national demand for copper in thousands of tonnes per month is: q^d(p) = 15 - pThe total costs in millions of dollars are: c(q) = 5q(a) What would be the profit-maximising level of production for this firm? Determine the monopoly price and quantify the profits. Graph the demand, marginal revenue and marginal cost, identifying their values along with determining the social loss generated and identifying it in the graph above. Assume now that due to a bad internal restructuring, the operations manager was fired and a professional with little mining experience was hired. The new manager does not know environmental protocol and mining waste (tailings) has gotten out of control and has been dumped into a river. This generated a negative externality on copper production. The estimated damage is US$5 million per 1,000 tonnes.(b) Obtain the social marginal cost of this mining activity.(c) What level of production will…
- The Poster Bed Company believes that its industry can best be classified as monopolistically competitive. An analysis of the demand for its canopy bed has resulted in the following estimated demand function for the bed: P=1,265−9Q�=1,265−9� The cost analysis department has estimated the total cost function for the poster bed as TC=Q33−15Q2+5Q+24,000TC=�33−15�2+5�+24,000 Short-run profits are maximized when the level of output is and the price is . The total profit at this price-output level is . The point price elasticity of demand at the profit-maximizing level of output is . The level of fixed costs the firm is experiencing on its bed production is .In the 1928, Knoxville was served by a single railroad line. Because alternative forms of transportation were not close substitutes for rail transportation in 1928, this railroad had a transportation monopoly in Knoxville. The estimated monthly fixed cost associated with operating a railroad was $1,200. In addition, there was a constant average variable cost and marginal cost of $0.02 per ton-mile associated with the railroad's operation. The estimated monthly demand for transportation on the railroad was: Qd = q = 80,000 - 1,000,000P where Qd was the monthly quantity demanded in ton-miles and P was the price per ton-mile in dollars. Based upon the above equation, answer the following questions: a. What is the profit-maximizing price and quantity? b. Would a private company build the railroad? c. What is the socially optimal price and quantity?Suppose a company has fixed costs of $31,200 and variable cost per unit of 1 3 x + 444 dollars, where x is the total number of units produced. Suppose further that the selling price of its product is 1768 − 2 3 x dollars per unit. Find the break-even points. (Enter your answers as a comma-separated list.) Find the maximum revenue. (Round your answer to the nearest cent.) Form the profit function P(x) from the cost and revenue functions. Find maximum profit. What price will maximize the profit? (Round your answer to the nearest cent.)
- Perum Perindo operates 2,500 hectares of shrimp pond in Bratasena, Lampung. There are many players in this market, including the traditional shrimp farmers and big companies listed in the IDX stock market. The product in this market is relatively standardized. It is known that perum Perindo total cost function is TC = 20 + 4Q + 0.003Q2 and the market price for a kilo of shrimp is $16. d. Write the firm variable cost and average variable cost functione. At the equilibrium level of output that has been calculated in question c , find the firm average variable cost (AVC)f. At current price level, should the firm continue to produce or shut down it operation? ExplainPerum Perindo operates 2,500 hectares of shrimp pond in Bratasena, Lampung. There are many players in this market, including the traditional shrimp farmers and big companies listed in the IDX stock market. The product in this market is relatively standardized. It is known that perum Perindo total cost function is TC= 20 + 4Q + 0.003Q2 and the market price for a kilo of shrimp is $16. a. Identify the market structure that perum Perindo operates inb. Find Perindo marginal costc. Find the equilibrium output leveld. Write the firm variable cost and average variable cost functione. At the equilibrium level of output that has been calculated in question c , find the firm average variable cost (AVC)f. At current price level, should the firm continue to produce or shut down it operation? ExplainBarnacle Industries was awarded a patent over 15 years ago for a unique industrial-strength cleaner that removes barnacles and other particles from the hulls of ships. Thanks to its monopoly position, Barnacle has earned more than $160 million over the past decade. Its customers—spanning the gamut from cruise lines to freighters—use the product because it reduces their fuel bills. The annual (inverse) demand function for Barnacle’s product is given by P = 400 − 0.0005Q, and Barnacle’s cost function is given by C(Q) = 250Q. Thanks to subsidies stemming from an energy bill passed by Congress nearly two decades ago, Barnacle does not have any fixed costs: The federal government essentially pays for the plant and capital equipment required to make this energy-saving product. Absent this subsidy, Barnacle’s fixed costs would be about $4 million annually. Knowing that the company’s patent will soon expire, Marge, Barnacle’s manager, is concerned that entrants will qualify for the subsidy,…