Summary ecs2601 assignment 6

Started on Sunday, 11 June 2023, 12:32 PM
State Finished
Completed on Sunday, 11 June 2023, 12:51 PM
Time taken 18 mins 32 secs
Marks 36.00/60.00
Grade 60.00 out of 100.00
Question 1
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Suppose that a competitive firm’s marginal cost of producing output q is given by
MC(q) = 3 + 2q. Assume that the market price of the firm’s product is R9.
What level of output will the firm produce?


a.
1.5


b.
6


c.
3


d.
9

Question 2
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A perfect price-discrimination monopolist will …

,a.
produce where MC=MR.


b.
leave no consumer surplus for his/her customer.


c.
produce the amount that is larger than a non-price discriminator.


d.
All of the options are correct.

Question 3
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A small city has a number of hot dog stands operating throughout the CBD area.
Suppose that each vendor has a marginal cost of R1,50 per hot dog sold and no fixed
cost. Suppose the maximum number of hot dogs that any one vendor can sell is 100 per
day.
If a hot dog is priced at R2, how many hot dogs would each street vendor want to
sell per day?


a.
50


b.
75


c.
0


d.
100

Question 4

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Cournot equilibrium is stable because each firm is producing the amount that maximizes
its profit, given what its competitors are producing.




Select one:
True
False
Question 5
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A firm should always produce at an output at which long-run average cost is minimized.

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True
False
Question 6
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Optimal, third-degree price discrimination do not require that marginal revenue for each
group of consumers equals marginal cost.




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