Commerce Exam > Commerce Questions > Expain the concept of short run equilibrium o...
Start Learning for Free
Expain the concept of short run equilibrium of a monopoly market assuming zero cost
? Related: Short run Equilibrium under Monopoly
Most Upvoted Answer
Expain the concept of short run equilibrium of a monopoly market assum...
Short Run Equilibrium under Monopoly
In a monopoly market with zero cost, the short run equilibrium is determined by the intersection of the monopoly's marginal cost (MC) and marginal revenue (MR) curves. Here's how it works:
1. Profit Maximization
- The monopoly will produce where MR = MC to maximize profits.
2. Price and Output Determination
- The price is determined by the demand curve at the quantity where MR = MC.
- The output level is determined by the quantity where MR = MC.
3. Profit or Loss
- If the price exceeds average total cost (ATC) at the profit-maximizing quantity, the monopoly earns profits.
- If the price is below ATC at the profit-maximizing quantity, the monopoly incurs losses.
4. Shutdown Point
- If the price falls below average variable cost (AVC) at the profit-maximizing quantity, the monopoly should shut down in the short run.
5. Impact on Market
- As a price maker, the monopoly can influence market prices and quantities.
- Consumers may face higher prices and lower quantities compared to a competitive market.
Attention Commerce Students!
To make sure you are not studying endlessly, EduRev has designed Commerce study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in Commerce.
|
Explore Courses for Commerce exam
|
|
Top Courses for CommerceView all
Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly?
Question Description
Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly?.
Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly?.
Solutions for Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly? in English & in Hindi are available as part of our courses for Commerce.
Download more important topics, notes, lectures and mock test series for Commerce Exam by signing up for free.
Here you can find the meaning of Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly? defined & explained in the simplest way possible. Besides giving the explanation of
Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly?, a detailed solution for Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly? has been provided alongside types of Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly? theory, EduRev gives you an
ample number of questions to practice Expain the concept of short run equilibrium of a monopoly market assuming zero cost Related: Short run Equilibrium under Monopoly? tests, examples and also practice Commerce tests.
|
|
Explore Courses for Commerce exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup