A monopolist A. can charge whatever price it wants because it is the only firm producing the good. B. can usually keep price equal to marginal revenue by lowering the price on the last unit sold only. C. is constrained in its pricing decisions by the demand curve it faces. D. faces a demand curve that is more elastic than the demand curve for the industry.

Related Questions

• The Reuschel Company began 2018 with an inventory of 10,000 units at a cost of $7 per unit. During 2018, 50,000 units were purchased for $8.50 each. Sales for the year totaled 54,000 units, leaving 6,000 units on hand at the end of 2018. Reuschel uses a periodic inventory system and the LIFO inventory cost method.Required: 1. Calculate cost of goods sold for 2018. 2. Calculate the effect of the LIFO on income.
• Kingbird Company is negotiating a nine-year lease of equipment with MTBA, Inc. The equipment has a useful life of ten years. Kingbird requires a guarantee that the equipment's residual value will be at least $4,000 at the end of the lease, and MTBA concurs, even though it anticipates the equipment's residual value to be only $2,000 at that time. Assuming the equipment's fair value at the start of the lease is $60,000, and Kingbird seeks a 6% return on the lease, the annual rental payment amount demanded by Kingbird needs to be determined with payments due at the beginning of each year. To calculate the annual rental payment, we would need to calculate the present value of the expected residual value at the end of the lease term and then determine the annual payments that allow Kingbird to recover the rest of the equipment value and earn the desired rate of return over the lease term. Here's the process: 1. Calculate the present value (PV) of the $4,000 guaranteed residual value at the end of the 9-year period, discounted at Kingbird's desired rate of return (6%): PV = FV / (1 + r)^n PV = $4,000 / (1 + 0.06)^9 PV = $4,000 / 1.689479373 PV ≈ $2,367.25 2. Subtract this present value of the residual value from the fair value of the equipment to get the amount that needs to be recovered through the lease payments: Amount to be recovered = Fair value - PV of residual value Amount to be recovered = $60,000 - $2,367.25 Amount to be recovered ≈ $57,632.75 3. Calculate the annual rental payment, taking into account that payments are made at the beginning of each period (i.e., an annuity due). First, we need the annuity due factor for a 6% rate of return over 9 periods: Annuity due factor = [(1 - (1 + r)^-n) / r] * (1 + r) Annuity due factor ≈ 7.523259448 (using an annuity due present value factor table or financial calculator) 4. Finally, divide the amount to be recovered by the annuity due factor to find the annual rental payment: Annual rental payment = Amount to be recovered / Annuity due factor Annual rental payment ≈ $57,632.75 / 7.523259448 Annual rental payment ≈ $7,662.88 Therefore, Kingbird Company should demand an annual rental payment of approximately $7,662.88 from MTBA, Inc. Please note that this is a simplified calculation and in practice, lease accounting can be more complex and may require more comprehensive financial modeling.
• If the social value of producing robots is greater than the private value of producing robots, the private market produces too few robots. a. true b. false
• JCS Incorporated experienced the following transactions during its first year of business. The company purchased $16,000 of merchandise from Kent Company. The company paid $2,000 for selling and administrative expenses and purchased land for $5,000. All of the merchandise purchased was sold for $30,000 cash. What is the company’s gross margin?
• 6. Financially, why would a company: (a) increase its dividend; (b) buy back its common stock shares; (c) pay down its debt; (d) boost its use of internal financing; (e) privatize?
• In deciding whether financing with receivables is a secured borrowing or a sale under U.S. GAAP, the critical element is the extent to which: A. The transferor of the receivable surrenders control over the assets transferred. B. The age of the receivables transferred differs from the average age of the receivabless C. The transferee has received substantially all the risks and rewards of ownership. D. The transferee relies on funds from the transferor to maintain operations.
• Production and sales estimates for June are as follows: Estimated inventory (units), June 1 18,500 Desired inventory (units), June 30 19,000 Expected sales volume (units): Area X 3,000 Area Y 4,000 Area Z 5,500 Unit sales price $20. The number of units expected to be manufactured in June is: a.10,000. b.12,000. c.13,000. d.12,500.
• Bob manages a grocery store in a country with high inflation. He receives his salary in cash bi-monthly. On payday, he promptly purchases goods for the next two weeks to avoid the devaluation of his cash. Any unspent money is exchanged for a more stable foreign currency, despite the high fees. This behavior exemplifies the impacts of inflation.
• The production of polyamide from raw materials of plant origin, such as castor oil, requires 20% less fossil fuel than conventional production methods. Darvon Chemicals borrowed $6 million to implement the process. If the interest rate on the loan is 10% per year (on an unrecovered balance) for 10 years, what is the amount of interest for year 2?
• Which of the following would have the least amount of influence on a manager's choice of whichinputs to employ in a production process? Select one: A. The price of a competitor's output. B. The technology of the production process. C. The marginal productivity of the inputs that can be used in the production process. D. The prices of the inputs that can be used in the production process.