Please, I need correct answers and clear explanation for BOTH questions. open im
ID: 1118392 • Letter: P
Question
Please, I need correct answers and clear explanation for BOTH questions. open image for a clear view. Thanks,
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Which of the following is a characteristic of a single-price monopoly?
Demand is perfectly elastic.
Marginal revenue is greater than marginal cost.
The firm is a price taker.
Price exceeds marginal revenue.
A.Demand is perfectly elastic.
B.Marginal revenue is greater than marginal cost.
C.The firm is a price taker.
D.Price exceeds marginal revenue.
2017-12-03.png Photos Question 1 1 points Prime Pharmaceuticals has deve loped a new asthma inhaler, for which it has a patent. An inhaler can be produced at a constant marginal cost of $2 per inhaler. The demand curve, marginal revenue curve, and marginal cost curve forthis new asthma inhaler are shown in Figure 13.4.6. The patent gives Prime Pharmace uti cals a monopoly for its new inhaler. if prime Pharmaceuticals can perfectly price discrim inate, producer surplus is Price (dollars per inhaler) 10 MC 8 12 6 20 Quantity (millions) O A $24 million. B.$16million. O C.$32 million. D.$64 million. 2:24 PM O Type here to search ^di ENG 2017-12-03Explanation / Answer
Answer
option D
Price exceeds marginal revenue
the monopoly have downward sloping demand curve and the marginal revenue curve is double sloped than demand curve, and the firm maximizes profit at MR=MC so at the equilibrium P>MR, even if it starts at the same point on the y-axis.