A Monopolist Owns Two Plants in Which to Produce a Product

question 7

Multiple Choice

A monopolist owns two plants in which to produce a product which has inverse demand P = (770/3) - 3Q. The monopolist has marginal cost curves of MC₁ = 20+3Q₁ and MC₂ = 10+6Q₂ in the two plants, respectively. Which of the following represents the optimal outputs in the two plants, Q₁ and Q₂ and the market price?

• A) Q₁ = 170/9; Q₂ = 100/9; P = 500/3.
• B) Q₁ = 100/9; Q₂ = 170/9; P = 500/3.
• C) Q₁ = 500/3; Q₂ = 170/9; P = 100/9.
• D) Q₁ = 500/3; Q₂ = 100/9; P = 170/9.

Understand how behavioral biases influence perceptions of gains and losses.

Understand and describe the stages of group development.

Recognize the relationship between group size and various group dynamics such as cohesiveness, performance, and member participation.

Comprehend the concept of process losses and its impact on actual group performance.

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Definitions:

Supplier Selection Criteria

The standards or benchmarks that companies use to evaluate and choose among potential suppliers.

TQM

Total Quality Management; a management approach to long-term success through customer satisfaction, focusing on continuous improvement of organizational processes.

ISO 9000

A set of international standards for quality management and quality assurance designed to help companies ensure they meet customer and other stakeholder needs.