{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

monopoly_heterogeneous

monopoly_heterogeneous - 1 A restaurant chain has to choose...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
1. A restaurant chain has to choose how many stores to open in a city. Assume it o/ers free delivery. Then it will open a socially excessive number of stores. True or false. Explain. 2. A monopolist can produce a low or high quality product. All consumers care the same for the low quality product but prefer the high quality one. However not all consumers care the same about the high quality product. Which of the following is/are true? (a) The monopolist may choose to sell the low quality product even when it is socially e¢ cient to sell the high quality one. (b) If the cost of production of either product is the same, the mo- nopolist will always choose to sell the high quality product. (c) The monopolist may choose to sell the high quality product even when it is socially e¢ cient to sell the low quality one. 3. A °rm will o/er too little variety if it can±t perfectly price discriminate. True or False. Explain. 4. A monopoly °rm that pays for distribution costs will set up more shops than one that does not. True or False. Explain.
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern