Chapter 9

Chapter 9 - and increase price Rent seeking – Activities...

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Chapter 9 – 12/6/07 Barrier to entry – any impediment that prevents new firms from entering an industry and competing on an equal basis with existing firms Patent – a legal barrier to entry that grants its holder the exclusive right to sell a product for 20 years from the date the patent application is filled Innovation – The process of turning an invention into a marketplace product Price Maker – a firm must find the profit maximizing price when the demand curve for its output slopes downward Deadweight Loss of Monopoly – net loss to society when a firm uses its market power to restrict output
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Unformatted text preview: and increase price Rent seeking – Activities undertaken by individuals or firms to influence public policy in a way that will increase their incomes Price Discrimination – Increasing profit b charging different groups of consumers different prices when the prices differences are not justifies by differences in production costs Perfectly discriminating monopolist – A monopolist who charges a different price for each unit sold; also called the monopolist’s dream...
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This note was uploaded on 04/29/2008 for the course EC 11 taught by Professor Kelly during the Fall '07 term at Fairfield.

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