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Why Do Monopolies Exist? Monopolists have market power and as a consequence will charges higher prices and generate less output than a competitive industry. It produces profit
Q. Explain Supernormal Equilibrium? Supernormal Equilibrium: E is the point of stable equilibrium as MC = MR and MC cuts the MR from below. Figure: Supernormal Equ
Autonomous Expenditure Also called Exogenous expenditure, is any expenditure that is taken as a constant or unaffected by any economic variables within our theory. For instan
A monopolist has two types of customers. There are 100 of Type A, who will every pay up to $10 for a single unit of the good, and 50 of Type B, who will every pay up to $8. Neithe
mini project on demand function
The Budget line and its economic interpretation The indifference curve shows us consumer preferences but it does not show us the situation in the market place. Here the consu
Problem 1: Using relevant examples, discuss the pricing strategies that firms can use to capture value from their customers. Problem 2: You are a manager in a perfectl
Cross-elasticity is the measure of responsiveness of demand for a commodity to the changes in price of its substitutes and complementary goods. For example, cross-elasticity of dem
Oligopoly can be characterized as follows: Small Number of Sellers: There are more than one sellers of a product though; the number isn't so huge in order to produce perfect
Technically Efficient Method of Production Let's suppose that commodity X is produced by two methods by employing capital and labour: Factor inputs Met
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