There is no profit in Monopoly in Short Run P=SAC→)=0 (normal profit exists SMC SAC SAVC MR=SMC D AR MR
21 There is no profit in Monopoly in Short Run SAVC SAC SMC P=SAC→π=0 (normal profit exists) Q* MR=SMC E $ P* D, AR 0 Q MR
Monopoly, Short Run Loss Minimizing P<SAC→>丌<0 SMC SAC SAVC MR=SMC D. AR MR
22 Monopoly, Short Run Loss Minimizing D, AR Q SMC P<SAC→π<0 Loss Q* MR=SMC E $ SAC P* SAVC D, AR 0 Q MR
Profit or Loss in SR equilibrium monopoly does not guarantee profit in the short run monopolist must typically, however, earn normal profits in long run monopolists will try to maximize profits or minimize losses If SAC lies above ar (demand curve) the monopolist will suffer a loss
23 Profit or Loss in SR Equilibrium monopoly does not guarantee profit in the short run monopolist must typically, however, earn normal profits in long run monopolists will try to maximize profits or minimize losses If SAC lies above AR (demand curve) the monopolist will suffer a loss
Long-run Equilibrium Under monopoly 24
24 Long-run Equilibrium Under Monopoly
Long-run Equilibrium Under Monopoly In the Long run All inputs are variable Maximizing level at LMCE MRE SMO Also where lmc smc then SAC LAC
25 Long-run Equilibrium Under Monopoly In the Long Run All inputs are variable Maximizing level at LMC = MR = SMC Also where LMC = SMC then SAC = LAC