Pure Monopoly

Февраль 11, 2021

Содержание

2. Four Market Models LO1 10-
3. An Introduction to Pure Monopoly Single seller – a sole producer No close substitutes – unique
4. Barriers to Entry Barrier to entry: a factor that keeps firms from entering an industry Economies
5. Monopoly Demand The pure monopolist is the industry Demand curve is the market demand curve Downsloping
6. Monopoly Demand Marginal revenue Monopolist is a price maker Monopolist sets prices in elastic region of
7. Output and Price Determination LO2 10-
8. Output and Price Determination LO2 0 D MR ATC MC MR=MC A=$94 Economic Profit Pm=$122 10-
9. Misconceptions of Monopoly Pricing Not highest price Total profit Possibility of losses LO2 10-
10. Misconceptions of Monopoly Pricing LO2 0 D MR ATC MC MR=MC Loss AVC Pm Qm V
11. Economic Effects of Monopoly LO3 (a) Purely Competitive Market (b) Pure Monopoly D D S=MC MC
12. Economic Effects of Monopoly Income transfer Cost complications Economies of scale X-Inefficiency Rent seeking expenditures Technological
13. X-Inefficiency LO3 ATC2 ATC1 ATCx Q1 Q2 Average Total Cost X X' ATCx' 10-
14. Price Discrimination Price discrimination Charging different buyers different prices Price differences are not based on cost
15. Conditions for success: Monopoly power Market segregation No resale Price Discrimination LO4 10-
16. Regulated Monopoly Natural monopolies Socially optimal price Set price = marginal cost Fair return price Set
18. Скачать презентацию

Слайд 2

Four Market Models
LO1
10-

Four Market Models LO1 10-

Слайд 3

An Introduction to Pure Monopoly
Single seller – a sole producer
No close substitutes

An Introduction to Pure Monopoly Single seller – a sole producer No

– unique product
Price maker – control over price
Blocked entry – strong barriers to entry block potential competition
Non-price competition – mostly PR or advertising the product

LO1

10-

Слайд 4

Barriers to Entry
Barrier to entry: a factor that keeps firms from entering

Barriers to Entry Barrier to entry: a factor that keeps firms from

an industry
Economies of scale
Legal barriers: patents and licenses
Ownership of essential resources
Pricing

LO1

10-

Слайд 5

Monopoly Demand
The pure monopolist is the industry
Demand curve is the market demand

Monopoly Demand The pure monopolist is the industry Demand curve is the

curve
Downsloping demand curve
Marginal revenue is less than price

LO1

10-

Слайд 6

Monopoly Demand
Marginal revenue < price
Monopolist is a price maker
Monopolist sets prices in

Monopoly Demand Marginal revenue Monopolist is a price maker Monopolist sets prices

elastic region of demand curve

LO2

10-

Слайд 7

Output and Price Determination
LO2
10-

Output and Price Determination LO2 10-

Слайд 8

Output and Price Determination
LO2
0
D
MR
ATC
MC
MR=MC
A=$94
Economic
Profit
Pm=$122
10-

Output and Price Determination LO2 0 D MR ATC MC MR=MC A=$94 Economic Profit Pm=$122 10-

Слайд 9

Misconceptions of Monopoly Pricing
Not highest price
Total profit
Possibility of losses
LO2
10-

Misconceptions of Monopoly Pricing Not highest price Total profit Possibility of losses LO2 10-

Слайд 10

Misconceptions of Monopoly Pricing
LO2
0
D
MR
ATC
MC
MR=MC
Loss
AVC
Pm
Qm
V
A
10-

Misconceptions of Monopoly Pricing LO2 0 D MR ATC MC MR=MC Loss

Слайд 11

Economic Effects of Monopoly
LO3
(a)
Purely Competitive Market
(b)
Pure Monopoly
D
D
S=MC
MC
P=MC=
Minimum
ATC
MR
Pc
Qc
Pc
Pm
Qc
Qm
Pure competition is efficient
Monopoly is inefficient
a
b
c
d
10-

Economic Effects of Monopoly LO3 (a) Purely Competitive Market (b) Pure Monopoly

Слайд 12

Economic Effects of Monopoly
Income transfer
Cost complications
Economies of scale
X-Inefficiency
Rent seeking expenditures
Technological advance
LO3
10-

Economic Effects of Monopoly Income transfer Cost complications Economies of scale X-Inefficiency

Слайд 13

X-Inefficiency
LO3
ATC2
ATC1
ATCx
Q1
Q2
Average
Total Cost
X
X'
ATCx'
10-

X-Inefficiency LO3 ATC2 ATC1 ATCx Q1 Q2 Average Total Cost X X' ATCx' 10-

Слайд 14

Price Discrimination
Price discrimination
Charging different buyers different prices
Price differences are not

Price Discrimination Price discrimination Charging different buyers different prices Price differences are

based on cost differences
Examples: business travel, electric utilities, movie theaters, golf courses, railroad companies, coupons, international trade

LO4

Price Discrimination

10-

Слайд 15

Conditions for success:
Monopoly power
Market segregation
No resale
Price Discrimination
LO4
10-

Conditions for success: Monopoly power Market segregation No resale Price Discrimination LO4 10-

Слайд 16

Regulated Monopoly
Natural monopolies
Socially optimal price
Set price = marginal cost
Fair return price
Set price

Regulated Monopoly Natural monopolies Socially optimal price Set price = marginal cost

= ATC

LO5

10-