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JeopardyFormulas
Perfect Competition Monopoly
Price Discrimination
Problems
Q $100
Q $200
Q $300
Q $400
Q $500
Q $100 Q $100Q $100 Q $100
Q $200 Q $200 Q $200 Q $200
Q $300 Q $300 Q $300 Q $300
Q $400 Q $400 Q $400 Q $400
Q $500 Q $500 Q $500 Q $500
Final Jeopardy
$100 Question from Formulas
Total Cost = ?
$100 Answer from Formulas
Total Cost = Fixed Cost + Variable Cost
$200 Question from Formulas
Total Revenue = ?
$200 Answer from Formulas
Total Revenue = Price * Quantity
$300 Question from Formulas
Marginal Cost = ?
$300 Answer from Formulas
Marginal Cost = Δtotal cost/Δquantity OrMarginal Cost = Δvariable cost/Δquantity
$400 Question from Formulas
Marginal Revenue = ?
$400 Answer from Formulas
Marginal Revenue = Δtotal revenue/Δquantity
$500 Question from Formulas
Profits = ?
$500 Answer from Formulas
Profits = Total Revenue – Total Cost
$100 Question from Perfect Competition
If the marginal revenue that a firm receives from producing one more unit exactly equal to the price it charges then what must be true?
$100 Answer from Perfect Competition
Perfect Competition
$200 Question from Perfect Competition
In Perfect Competition, a firm choosesq* at what point?
$200 Answer from Perfect Competition
Where Price = Marginal Cost
$300 Question from Perfect Competition
A Perfectly Competitive firm is selling 100 units at a market price of $10. It’s profits are$50,000, and the MC of the 100th unit is $8, what should they do?Increase quantityKeep quantity constant Decrease quantity
$300 Answer from Perfect Competition
Increase quantity since MC($8)<Price ($10)
$400 Question from Perfect Competition
A firm has TR of 40,000 FC of $50,000VC of $20,00What are profits?What should the firm do in the Short Run?The Long Run?
$400 Answer from Perfect Competition
Profits = -$20,000Firm should produce in the Short Run sinceTR>VCBut exit in the Long Run
$500 Question from Perfect Competition
Q MC
0 ---
1 5
2 6
3 7
4 8
5 9
6 10
In Perfect Competition, the market price is $8, what is q*?
$500 Answer from Perfect Competition
Q* = 4
$100 Question from Monopoly
If there are barriers to entry in a market, then thefirm must be what?
$100 Answer from Monopoly
A Monopoly
$200 Question from Monopoly
Suppose a firm made positive profits in the short run but zero profits in the long run this firm could not be what?
$200 Answer from Monopoly
Could not be a Monopoly
$300 Question from Monopoly
A Monopoly choose quantity at what point?
$300 Answer from Monopoly
Where MR=MC
$400 Question from Monopoly
Where does a Monopoly set its price?
$400 Answer from Monopoly
Find q* where MR=MC, then followthat all the way up to the demand curve.
$500 Question from Monopoly
What will a Monopoly do in the short run if ithas negative profits?
$500 Answer from Monopoly
It will produce only if it can cover its variable costs.
$100 Question from Price Discrimination
Suppose a firm can charge a different price to each consumer, what type of price discriminationis this?
$100 Answer from Price Discrimination
First-Degree price discrimination
$200 Question from Price Discrimination
When a firm charges different prices for different amounts of goods (i.e. bundling)they are using what type of price discrimination?
$200 Answer from Price Discrimination
Second-Degree Price Discrimination
$300 Question from Price Discrimination
When a firm charges different prices todifferent groups of people they are using what type of price discrimination?
$300 Answer from Price Discrimination
Third-Degree Price Discrimination
$400 Question from Price Discrimination
When a firm charges an upfront fee along withadditional charges later on, they are usingwhat type of price discrimination?
$400 Answer from Price Discrimination
A two-part tariff
$500 Question from Price Discrimination
Your Text Here
Customer Type Elasticity of Demand
A - 4.2
B - 0.7
C - 1.8
D - 2.1
E - 3.6
If a firm wants to start using third-degree price discrimination, and each consumer has a different elasticity of demand, which customerwould most likely pay the highest price?
$500 Answer from Price Discrimination
Consumer B, since they have the most inelasticdemand. Which means they are the least sensitive to price.
$100 Question from ProblemsLabor Quantity
1 10
2 18
3 24
Fill in the Average Product of Labor for each row.
$100 Answer from Problems
Your Text HereLabor Quantity APL
1 10 10
2 18 9
3 24 8
$200 Question from Problems
The Average Total Cost curve is at its minimum where it crosses what curve?
$200 Answer from Problems
The Marginal Cost Curve
$300 Question from Problems
Describe Monopolistic Competition
$300 Answer from Problems
There are several to many firms in the market.There is free entry and exit.Non-identical Products.Firm acts like a Monopoly in the short run(chooses MR=MC)Due to free entry and exit are like perfect competition in the Long Run.
$400 Question from Problems
Q P TR
0 120 0
1 110 110
2 100 200
3 90 270
4 80 320
5 70 350
6 60 360
If this is a Monopoly with a MC = 10, what quantity will it produce?
$400 Answer from Problems
Q = 6 calculate MR and find where it equalsMC.
$500 Question from H5
Your Text Here
Q MC
0 ---
1 10
2 7
3 5
4 9
5 15
6 20
If this is a Competitive Firm with FC of $20, what is the Total Cost of producing 5 units?
$500 Answer from Problems
TC = 66
Final JeopardyQ TC FC VC ATC AVC MC
0 0 -- -- --
1 13 10
2 2
3 2
4 10
5 6
Fill in the table
Final Jeopardy AnswerQ TC FC VC ATC AVC MC
0 10 10 0 -- -- --
1 13 10 3 13 3 3
2 15 10 5 7.5 2.5 2
3 16 10 6 5.3 2 1
4 20 10 10 5 2.5 4
5 30 10 20 6 4 10