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N_P_Key_Ch_14 - Chapter 14 Monopoly& Antitrust Policy...

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Unformatted text preview: Chapter 14 Monopoly & Antitrust Policy Some concepts and vocabulary Patent ‘ Cepyfight Network externalities Economies of Scale Natural Monopoly Antitrust Law Efficiency Considerations of Monopoly Note bene Monopoly is the case of a single seller. You should be familiar with the sources of monopoly as described in the book and the graphs we use to describe the pricing and output decisions of the monopolist. What are the efficiency considerations regarding monopolies? Are monopolies fairly common or quite rare? Consider the tension between antitrust policy that attempts to limit monopoly and intellectual property law [e.g. patents and copyrights} that create monopolies. Practice Problem: (a) Suppose the chart below describes demand conditions for a particular monopolist. Fill in the missing data. (b). If the firm facing the demand schedule in the chart above faces a constant MC of $5, at what level of output {Q} should it choose to produce? Q : 74 34 ...
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