# Questions tagged [monopoly]

A market structure in which there is a single firm acting as supplier.

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### How price is determined in the following monopoly model question?

I am studying microeconomics, and got stuck on the following question, specifically, part (b) and part (c): A monopoly-owned retail store is located next to a monopoly-owned parking lot. (The store ...
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### High Fixed Cost and Zero VC

Suppose a Monopoly has a High Fixed Cost= 0.5 and VC=0 . The Profit Max O/t : Q=1 But the Profit = -0.13 (which is < 0) which means -0.13 > -0.5 Should the Firm Produce produce Q=1 or Q=0 ? ...
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### A monopolist has decreasing average costs, setting the price equal to AC will lead to?

1)what will happen to the Output compared to the situation where MR=MC ? 2)what will happen to the Output compare to Competitive Output? Attempt at Soln. : 1) 2) so definitely quantity of o/t for ...
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### Doubt on Calculation of MR

So this is very beginner level doubt. I know $MR = \frac{\partial TR}{\partial q}$ . So TR need to be in terms of q to differentiate. This helps us to find Optimal Output level in Monopoly by ...
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### perfect price discrimination and allocative efficiency for a monopoly

Maybe I am just confusing myself, but what does charging a different price at every unit have to do with an output level being allocatively efficient? I understand what price discrimination is, I just ...
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### What is max here, and how did they derive the first order condition from it?

Hello. Someone sent this on a discord server that I am on, and I couldn't make heads or tails of this. I found the book it is from on studocu; solutions to Cabral's Industrial Organisations, 2nd Ed. ...
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### Question About Non-Discriminating Monopolist - Mathematics for Economists by Simon and Blume Chapter 17 Exercise 7

I am working on Mathematics for Economists by Simon and Blume Exercise 17.7. I know there is an Answers Pamphlet. However, the solution to this question does not make any sense to me. It seems that ...
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### Price in Second-degree Price Discrimination

In 2nd degree price discrimination, the producer only knows that there are different consumer groups who have different demand curves. He thus adjusts the quantity/quality of the product in a way that ...
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### Shouldn't big tech want to split up?

This is a reference request. Where can I find an analysis that explains why companies like Microsoft and Amazon don't split into two. At a certain point diseconomies of scale would kick in. I would ...
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### Has monopoly theory incorporated network effects as a source of monopoly?

I studied industrial organization for my Econ. Ph.D. four decades ago. At that time industrial organization had no way to incorporate 'network effects' into monopoly theory. With the advent of social ...
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### Solving problem for optimal price (maximize profit) *attempt inside*

Let a demandfunction be defined as $D(p)=B-bp$, where $b,B>0$. A firm has some production cost, $c$, and can set the price $p$ under the constrain given by the Demand. What is the optimal price? ...
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### Two part tariff-income effects

I understand that a monopolist optimally sets a two-part tariff by pricing at marginal cost and then extracting CS as a lump sum fee. However, wouldn't the lump sum fee induce a decrease in consumer ...
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### Is there a qualitative difference between the rent derived from a supply fixed by nature and single supplier required to supply a fixed quantity?

The assumption are that supply is absolutely and permanently fixed at q average and marginal costs are zero demand always exceeds supply (P ≥ 0) The graph should look the same in both cases: a ...
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### Are urban land (location) markets considered competitive even though the market price does not equal marginal cost (zero)?

Urban land (location) supply is fixed and the marginal cost of bringing an urban plot into production is zero. Even when land owners do not collude to limit the supply, the fixed supply arguably ...
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### What has been the reception of Posner & Weyl’s claim that property rights lead to market power?

Posner & Weyl claim that property rights lead to monopoly rents: Property Is Only Another Name for Monopoly Radical Markets Have their claims been elaborated, tested, or peer-reviewed? In ...
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### Monopoly: Demand Curve and Marginal Revenue Curve Intercepts

I'm doing an introductory economics course, having never done economics before. In our topics, we covered monopoly and the principle that the marginal revenue slope is twice that of the demand slope. ...
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