A Nondiscriminating Pure Monopolist Is Generally Viewed As (2024)

FAQs

Is a nondiscriminating pure monopoly generally viewed as being? ›

productively inefficient, but allocatively efficient.

A non-discriminating pure monopolist faces a demand curve which is the same as the market demand curve. The demand curve is downward sloping. The marginal revenue for such a firm is below the demand curve because for the firm to sell one more unit, it has to lower its selling price.

The answer is most likely c. neither productively nor allocatively efficient. This is because a monopoly naturally has no competition which means a high likelihood of the monopoly not producing goods as efficiently as possible.

A non-discriminating monopolist is a person who aims at maximizing profit by charging the same price for all the customers. When there is inelastic demand, they will increase the price of the product to make a better profit. They will not produce beyond a certain output level.

Answer and Explanation:

These prices are lowered so that maximum quantities of output could be sold. This scenario happens because the average revenue of the monopolist firm is generally higher if it is compared with the marginal revenues.

Expert-Verified Answer

The marginal revenue of the fiftieth unit for a nondiscriminating pure monopolist that can sell the unit for $50 is also $50. This is because under monopolistic conditions, the marginal revenue is less than the price.

If a nondiscriminating pure monopolist decides to sell one more unit of output, the marginal revenue associated with that unit will be: the price at which that unit is sold less the price reductions which apply to all other units of output.

A Single Price Monopolist

Because a monopolist faces a downward sloping demand curve, she must lower the price if she wants to sell more goods (recall that the law of demand states that this inverse relationship exists between price and quantity demanded).

A pure monopoly is a single seller in a market or sector and high barriers to entry, such as significant startup costs. There are no substitutes for the product sold by the seller.

An unregulated monopoly has market power and can influence prices. Examples: Microsoft and Windows, DeBeers and diamonds, your local natural gas company. Individual restaurants and other products that enjoy “brand loyalty” in otherwise competitive markets will choose prices and output just like monopolists do.

What is a discriminating monopolist? ›

A discriminating monopoly is a monopoly firm that charges different prices to different segments of its customer base. An online retailer may charge higher prices to buyers in wealthy ZIP codes and lower prices to those in poorer regions.

f a pure monopolist can price discriminate by separating buyers into two or more groups: the marginal revenue curve will now shift to a position above the demand curve. marginal revenue will become less at each level of output than it would be without price discrimination.

The nondiscriminating pure monopolist's demand curve: tends to be inelastic at high prices and elastic at low prices. shows a direct or positive relationship between price and quantity demanded. is identical to its marginal revenue curve. is the industry demand curve.

The following are the differences between the Simple Monopoly and the Discriminatory Monopoly: 1. "Simple Monopoly" is a situation where monopolist charges a single price to all the customers whereas in the "Discriminatory Monopoly" the monopolist charges different prices to a different group of customers. 2.

Thus, if a monopolist is able to perfectly price discriminate, the demand curve and the marginal revenue curve are identical. The perfectly discriminating monopolist would produce where marginal revenue or demand equals marginal cost. This would also be the competitive output, so there is no deadweight loss.

Pure monopoly refers to a type of economic market. It is a situation in which a single corporation controls the whole supply of goods or services. In a pure monopoly, only one company exists, and it determines all terms, conditions, rules, and pricing. It develops when a single company dominates a product's market.

A pure monopoly is a market structure where one company is the single source for a product and there are no close substitutes for the product available. Pure monopolies are relatively rare. In order for a provider to maintain a pure monopoly, there must be barriers preventing competitors from entering the market.

A pure monopoly exists when a single firm is the sole producer of a product for which there are no close. Substitutes.

A discriminating monopoly is a monopoly firm that charges different prices to different segments of its customer base. An online retailer may charge higher prices to buyers in wealthy ZIP codes and lower prices to those in poorer regions.