Question 1

Scenario 15-11
Vincent operates a scenic tour business in Boston. He has one bus which can fit 50 people per tour and each tour lasts 2 hours. His total cost of operating one tour is fixed at $450. Vincent's cost is not reduced if he runs a tour with a partially full bus. While his cost is the same for all tours, Vincent charges each passenger his/her willingness to pay: adults $18 per trip, children $10 per trip, and senior citizens $12 per trip. At those rates, on a typical day Vincent's demand is:
  Assume that Vincent's customers are always available for the tour; therefore, he can fill his bus for each tour as long as there is sufficient total demand for the day.
-Refer to Scenario 15-11. Vincent uses a pricing practice called

Accepted Answer

The answer of Scenario 15-11
Vincent operates a scenic tour business...

Question 2

Figure 15-24 
-Refer to Figure 15-24. Which letter represents the profit-maximizing quantity chosen by the single price monopolist?

Accepted Answer

The answer of Figure 15-24 
-Refer to Figure 15-24. Which...

Question 3

Figure 15-25 
-Refer to Figure 15-25. If a regulator requires this firm to charge a socially optimal price, which letter represents the amount of output it will produce?

Accepted Answer

The answer of Figure 15-25 
-Refer to Figure 15-25. If...

Question 4

Figure 15-24 
-Refer to Figure 15-24. Use the letters in the figure to identify the area of deadweight loss for the single price monopolist.

Accepted Answer

The answer of Figure 15-24 
-Refer to Figure 15-24. Use...

Question 5

The distribution of water to residents of a town and an infrequently used bridge are examples of

Accepted Answer

The answer of The distribution of water to residents of...

Question 6

Scenario 15-11
Vincent operates a scenic tour business in Boston. He has one bus which can fit 50 people per tour and each tour lasts 2 hours. His total cost of operating one tour is fixed at $450. Vincent's cost is not reduced if he runs a tour with a partially full bus. While his cost is the same for all tours, Vincent charges each passenger his/her willingness to pay: adults $18 per trip, children $10 per trip, and senior citizens $12 per trip. At those rates, on a typical day Vincent's demand is:
  Assume that Vincent's customers are always available for the tour; therefore, he can fill his bus for each tour as long as there is sufficient total demand for the day.
-Refer to Scenario 15-11. What is Vincent's profit on a typical day?

Accepted Answer

The answer of Scenario 15-11
Vincent operates a scenic tour business...

Question 7

Figure 15-24 
-Refer to Figure 15-24. Use the letters in the figure to identify the profit area if this firm were able to perfectly price discriminate.

Accepted Answer

The answer of Figure 15-24 
-Refer to Figure 15-24. Use...

Question 8

Figure 15-24 
-Refer to Figure 15-24. Which letter represents the profit-maximizing price chosen by the single price monopolist?

Accepted Answer

The profit-maximizing price is the price at which the marginal revenue curve intersects the marginal cost curve. In Figure 15-24, this occurs at point B.

Question 9

Scenario 15-11
Vincent operates a scenic tour business in Boston. He has one bus which can fit 50 people per tour and each tour lasts 2 hours. His total cost of operating one tour is fixed at $450. Vincent's cost is not reduced if he runs a tour with a partially full bus. While his cost is the same for all tours, Vincent charges each passenger his/her willingness to pay: adults $18 per trip, children $10 per trip, and senior citizens $12 per trip. At those rates, on a typical day Vincent's demand is:
  Assume that Vincent's customers are always available for the tour; therefore, he can fill his bus for each tour as long as there is sufficient total demand for the day.
-Refer to Scenario 15-11. One of Vincent's friends tells him he would be more profitable if he charged a single price of $12. Assuming no changes in consumer demand, what would Vincent's profit be if he charged every customer $12?

Accepted Answer

The answer of Scenario 15-11
Vincent operates a scenic tour business...

Question 10

Figure 15-25 
-Refer to Figure 15-25. If a regulator requires this firm to charge a fair return price, which letter represents the amount of output it will produce?

Accepted Answer

The answer of Figure 15-25 
-Refer to Figure 15-25. If...

Question 11

Figure 15-24 
-Refer to Figure 15-24. If this firm were able to perfectly price discriminate, which letter represents the amount of output it would produce?

Accepted Answer

The answer of Figure 15-24 
-Refer to Figure 15-24. If...

Question 12

Figure 15-25 
-Refer to Figure 15-25. If a regulator requires this firm to charge a socially optimal price, how much deadweight loss results?

Accepted Answer

The answer of Figure 15-25 
-Refer to Figure 15-25. If...

Question 13

Scenario 15-11
Vincent operates a scenic tour business in Boston. He has one bus which can fit 50 people per tour and each tour lasts 2 hours. His total cost of operating one tour is fixed at $450. Vincent's cost is not reduced if he runs a tour with a partially full bus. While his cost is the same for all tours, Vincent charges each passenger his/her willingness to pay: adults $18 per trip, children $10 per trip, and senior citizens $12 per trip. At those rates, on a typical day Vincent's demand is:
  Assume that Vincent's customers are always available for the tour; therefore, he can fill his bus for each tour as long as there is sufficient total demand for the day.
-Refer to Scenario 15-11. One of Vincent's friends tells him he would be more profitable if he charged a single price of $18. Assuming no changes in consumer demand, what would Vincent's profit be if he charged every customer $18?

Accepted Answer

The answer of Scenario 15-11
Vincent operates a scenic tour business...

Question 14

Scenario 15-11
Vincent operates a scenic tour business in Boston. He has one bus which can fit 50 people per tour and each tour lasts 2 hours. His total cost of operating one tour is fixed at $450. Vincent's cost is not reduced if he runs a tour with a partially full bus. While his cost is the same for all tours, Vincent charges each passenger his/her willingness to pay: adults $18 per trip, children $10 per trip, and senior citizens $12 per trip. At those rates, on a typical day Vincent's demand is:
  Assume that Vincent's customers are always available for the tour; therefore, he can fill his bus for each tour as long as there is sufficient total demand for the day.
-Refer to Scenario 15-11. What is Vincent's cost of serving all passengers demanding a tour on a typical day?

Accepted Answer

The answer of Scenario 15-11
Vincent operates a scenic tour business...

Question 15

Figure 15-25 
-Refer to Figure 15-25. If this firm profit maximizes, which letter represents the price it will charge?

Accepted Answer

The profit-maximizing price is where marginal revenue equals marginal cost. At point A, marginal revenue equals marginal cost, so this is the profit-maximizing price.

Question 16

Figure 15-24 
-Refer to Figure 15-24. Use the letters in the figure to identify the profit area for the single price monopolist.

Accepted Answer

The answer of Figure 15-24 
-Refer to Figure 15-24. Use...

Question 17

Figure 15-25 
-Refer to Figure 15-25. If this firm profit maximizes, which letter represents the quantity it will produce?

Accepted Answer

The answer of Figure 15-25 
-Refer to Figure 15-25. If...

Quiz 15: Monopoly

Figure 15-24 -Refer to Figure 15-24. Which letter represents the profit-maximizing quantity chosen by the single price monopolist?

Figure 15-25 -Refer to Figure 15-25. If a regulator requires this firm to charge a socially optimal price, which letter represents the amount of output it will produce?

Figure 15-24 -Refer to Figure 15-24. Use the letters in the figure to identify the area of deadweight loss for the single price monopolist.

The distribution of water to residents of a town and an infrequently used bridge are examples of

Figure 15-24 -Refer to Figure 15-24. Use the letters in the figure to identify the profit area if this firm were able to perfectly price discriminate.

Figure 15-25 -Refer to Figure 15-25. If a regulator requires this firm to charge a fair return price, which letter represents the amount of output it will produce?

Figure 15-24 -Refer to Figure 15-24. If this firm were able to perfectly price discriminate, which letter represents the amount of output it would produce?

Figure 15-25 -Refer to Figure 15-25. If a regulator requires this firm to charge a socially optimal price, how much deadweight loss results?

Figure 15-24 -Refer to Figure 15-24. Use the letters in the figure to identify the profit area for the single price monopolist.

Figure 15-25 -Refer to Figure 15-25. If this firm profit maximizes, which letter represents the quantity it will produce?