Lecture Notes, Econ 142A: Monopoly and Oligopoly Models
1. What is market power?
1. The relationship between a market and market power.
what is a market: define by demand. (a firm that produces multiple goods operates in many
markets, which can be analyti
October 8, 2012
1. The monopolist sets marginal revenue equal to marginal price. (diagram)
2. The monopolist never operates on inelastic portion of demand curve. why?
(i) if demand is inelastic, what happen
Lecture 4: Econ 142A
Newspaper this morning reported increase of 25 cents per gallon in wholesale price of gasoline. Never
mind the wholesalers who are either responding to a very small shortage or maybe speculation.
Consider phenomenon known as the rocke
Lecture 3, Oct. 3, 2012. Chapter 3
Introductory IO is mostly about markets, with very simple models of firms, characterized by a set of costs
and profit-maximizing behavior. This is the basis of our analyses of behavior, efficiency and welfare.
Lecture 2, Oct. 1. 2012. Chapter 2
(i) quantity demanded at a given price
(ii) willingness to pay for a given quantity
Market demand = sum of individual demand
normal demand, D(p) = quantity demanded at price p