Question

In: Economics

Could you explain to me how a decrease in cost would change the profit maximizing behavior...

Could you explain to me how a decrease in cost would change the profit maximizing behavior of firms in monopolistic competition without being worried about the change in number of firms in the industry?

Solutions

Expert Solution

The explanation of the above question mentioned in below image

Rahul Sunny answered 1 year ago
Next > < Previous

Related Solutions

Could you explain to me how to solve for the appropriate values in the cost reconciliation...
Could you explain to me how to solve for the appropriate values in the cost reconciliation table (as seen in number 4)? I followed the problem in all the other sections, but not for this one: http://www.chegg.com/homework-help/scribners-corporation-produces-fine-papers-three-production-chapter-4-problem-10e-solution-9780077386214-exc The first half of the table, labeled "costs to be accounted for" was confusing.
Describe the Behavior of the Profit-Maximizing Firm. How does the firm account for costs? Define and...
Describe the Behavior of the Profit-Maximizing Firm. How does the firm account for costs? Define and explain the two types of costs associated with production? How do decisions change from the short-run to the long-run?
Write ONE proposal for behavior change. This could be a behavior change for yourself or someone...
Write ONE proposal for behavior change. This could be a behavior change for yourself or someone else (friend, family member, etc.). The behavior change program should incorporate and specify at least two basic principles of behavior (e.g., reinforcement, punishment, stimulus control, prompting, etc). You may elect to increase/decrease the frequency of an existing behavior, establish a new behavior, or some combination. It will also be important to incorporate examples when designing your behavior change program (I.e., describe the experimental design...
3) Price Discrimination Graphically show and explain, given a constant marginal cost, how the profit maximizing...
3) Price Discrimination Graphically show and explain, given a constant marginal cost, how the profit maximizing price and quantity are determined by a a) Single priced monopolist b) Perfect (first degree) price discriminating monopolist c) (Third degree) price monopolist who can separate the buyers into two groups and charge them each a single but different price. Compare or rank (from highest to lowest) the resulting price and quantity and producer surplus in each of these three monopolistic situations, explaining why...
can you please explain to me what is the meaning of cost structure and profit stability?...
can you please explain to me what is the meaning of cost structure and profit stability? and the operating leverage? can you give an example to these two questions of mine? thank you.
1. Explain whether each of the following actions would affect the firm’s profit-maximizing decision. (Hint: how...
1. Explain whether each of the following actions would affect the firm’s profit-maximizing decision. (Hint: how would each affect MR and MC?) i.An increase in the per unit cost of a variable input such as labor ii.A decline in the output price for a price-taking firm iii.Institution of a small fixed fee to be paid to the government for the right of doing business iv.Institution of a 50 percent tax on the firm’s economic profits v.Institution of a per-unit tax...
Do you think the monopolist acts as profit maximizing ( price , cost ) ? illustrate...
Do you think the monopolist acts as profit maximizing ( price , cost ) ? illustrate your answer with graph.
What would be the profit-maximizing price for the firm to charge?
What would be the profit-maximizing price for the firm to charge?
Show how the profit-maximizing graph would differ for a firm if the city does away with...
Show how the profit-maximizing graph would differ for a firm if the city does away with the medallion system and allows new firms to enter the taxi business at will which leads to a large number of new entrants.
How would the body normally compensate for this change in MAP such as a decrease? targets,...
How would the body normally compensate for this change in MAP such as a decrease? targets, steps pathways end response?
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT