What is the shut down rule for monopolist

Assignment Help Business Economics
Reference no: EM131391951

What is the “shut down rule” for a monopolist that is able to charge each purchaser the maximum amount they would be willing to pay for a product, i.e., a monopolist exercising perfect price discrimination?

A. Shut down unless average revenue equals or exceeds average fixed costs.

B. Shut down if total revenue is less than total variable cost.

C. Offer a particular quantity of a product for sale, but only if average total costs of doing so are less than average revenue.

D. Shut down if it is not possible to operate without incurring a loss.

E. None of the statements in A—D accurately describe the shutdown rule for a monopolist

Reference no: EM131391951

Questions Cloud

As medical technology continues to develop : As medical technology continues to develop, will the marginal productivity of each additional dollar spent on it increase or decrease? What about the average productivity per dollar spent on medical care?
Watchdog for consumers to being lapdog for industry : What term do economists use to describe how governmental agencies such as, say, the Federal Trade Commission, may go from being a “watchdog” for consumers to being a “lapdog” for industry?
The population and advance of medical technology : Given the ever-increasing age of the population and advance of medical technology, why would anyone expect the growth of medical costs to slow down in the future?
Consumer surplus and producer surplus : Suppose that the technology for producing a good improves so that production is less expensive. Please show how this impacts on consumer surplus and producer surplus.
What is the shut down rule for monopolist : What is the “shut down rule” for a monopolist that is able to charge each purchaser the maximum amount they would be willing to pay for a product, i.e., a monopolist exercising perfect price discrimination?
What is the shut down rule for firm offering : What is the “shut down rule” for a firm offering to sell its product in a highly competitive market?
Consumer surplus-producer surplus and tax revenue : Suppose that a tax of €10 is levied on every unit of a good. Using a typical supply and demand diagram, please show the relationship between consumer surplus, producer surplus, tax revenue and deadweight loss.
Captures the so-called shut down rule for monopolist : Which of the following statements best captures the so-called “shut down rule” for a monopolist that is able to engage in perfect price discrimination?
The total cost curve gets steeper as output increases : The total cost curve gets steeper as output increases because of

Reviews

Write a Review

Business Economics Questions & Answers

  In a capitalistic economy

In a capitalistic economy:

  Why do oligopolistic markets tend to exhibit price stability

What programs are dealing effectively with this population? Why do oligopolistic markets tend to exhibit price stability, and if this is the case, how do firms in these markets compete (illustrating with a couple of real-life examples)?

  What is the yearly return on the bond you are holding

Suppose you are holding a 5 percent coupon bond maturing in one year with a yield to maturity of 15 percent . If the interest rate on one year bonds rises from 15 percent to 20 percent over the course of the year what is the yearly return on the bond..

  By law of one price this must be premium of the oprtfolio

Consider a risk free asset that can be bought (lent) or sold (borrowed) with an interest rate of 75% such that $1 today is worth$1.75 a period later. What is the number of shares (X) to be held in addition to the -$14.29 in the replicating portfolio?..

  Investment spending change as the events occur

How will planned investment spending change as the following events occur?

  Supply of and the demand for good are highly elastic

If both the supply of and the demand for a good are highly elastic, a shift of either curve will always result in. If the supply of rental housing increases causing the price to fall and apartment dwellers move into bigger apartments that cost the sa..

  Obtaining human food pose for wild animals and birds

In some national parks there are signs asking campers not to feed the wild animals and, similarly, signs are often posted around lakes asking visitors not to feed the birds. What negative externality does obtaining human food pose for wild animals an..

  If marginal product is greater than average product

If marginal product is greater than average product, average product is falling. Marginal cost is less than average variable cost when average variable cost is falling. If the average total cost curve is above the marginal cost curve, then total cost..

  Use to implement such pricing policy

The Snow City Ski Resort caters to both out-of-town skiers and local skiers. The demand for ski tickets for each market segment is independent of the other market segments. What techniques might the resort use to implement such a pricing policy? What..

  Concerned about growing inequality of incomes

Suppose a country's government is concerned about growing inequality of incomes and wants to undertake a program that will increase the total earnings of the unskilled. Extending employer payroll taxes to all earnings over $117,000 per year and incre..

  Revenue of seignorage if monetary base triples every period

Consider an economy in which people wish to hold bank checking deposits worth a total of 5 million goods and currency worth 2 million goods in every period. In addition there is a stock of unintermediated capital worth 10 million goods. Find the reve..

  What is the after tax cash flow from sale of this property

A property can be sold for $2,946,300 with selling cost of 6% of the sales price. The mortgage balance at the time of sale is $1,600,000. The property was purchased 5 years ago for $2,100,000. Accumulated depreciation allowances of $380,000 have been..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd