Homework
#8, Econ 306, Prof. Hanson.
1. The following table describes the demand curve and cost curve facing a firm.
a.
What
is the fixed cost of production?
b.
If
this firm acted competitively, what would be its price and quantity?
c.
If
the firm acted as a monopolist, what would be its price and quantity?
|
P |
Q |
TC |
|
18 |
0 |
20 |
|
16 |
1 |
20 |
|
14 |
2 |
22 |
|
12 |
3 |
26 |
|
10 |
4 |
32 |
|
8 |
5 |
40 |
|
6 |
6 |
50 |
|
4 |
7 |
62 |
|
2 |
8 |
76 |
|
0 |
9 |
92 |
2. Here are some questions about where you expect to find stuff cheaper:
a. Where would you expect to find books cheaper online, at Amazon.com or at a less well-known online bookseller? Why?
b. Who do you expect to get cheaper offers for magazine subscriptions, those who renew quickly or those who wait until the last minute to renew? Why?