Answer each question concisely but with detail, including calculations. Come to the point and be precise. Do not restate definitions.
Use only the information given in a question to answer that question-assume ceteris paribus unless otherwise specified.
Answer all questions correctly.
1. Consider a Perfectly Competitive market where the demand is given by
P = 1200 - 2Q and the supply is given by P = Q.
a. Calculate the equilibrium price, quantity, total Consumer Surplus, and total Producer Surplus. Show all calculations.
b. Suppose this market now is controlled by a single-price monopolist whose marginal cost function is MC = Q. Determine this firm's marginal revenue function, then calculate its profit-maximizing quantity and price. Also calculate the total Consumer Surplus and total Producer Surplus. Show all calculations.
2. In the fall of 2017 the FCC concluded there is "effective competition" in the U.S. wireless market. Investigate this using reputable sources (and list your citations). Keep your answer under 3 pages. Specifically:
a. Identify the 4, current largest wireless carriers and their respective market shares
b. Identify the carrier with the largest market share, each year since the beginning of the wireless industry (and include each year's market share)
c. Cite 3 events (e.g., mergers, technological advances, legal issues, etc.) since the beginning of the industry which have had a significant impact on the industry; identify any industry trends you see which are linked to these events.
Type your answers to each question in a Word document. Include the question in your responses. Use a 12 point size and reasonable font.