Monopoly FRQ Practice 6
Sign in to Google to save your progress. Learn more
First Name *
Last Name *
SCHOOL email address *
Class Period *
Describe the steps that you personally took to UNDERSTAND the material.   *
There is one art museum on the island of Watsonia. The museum’s demand and cost curves are shown in the graph above. The museum currently relies on an admission charge for some of its funding. Its directors are debating about how to set the admission charge.
There is one art museum on the island of Watsonia. The museum’s demand and cost curves are shown in the graph above. The museum currently relies on an admission charge for some of its funding. Its directors are debating about how to set the admission charge.
(a) Using the labeling of the graph above, identify the price and quantity associated with the following  objectives.
(i) The museum maximizes its profit. *
Price AND Quantity
1 point
(ii) The museum maximizes its total revenue. *
Price AND Quantity
1 point
(iii) The museum maximizes the sum of consumer and producer surplus. *
Price AND Quantity
1 point
(iv) The museum maximizes its attendance (output), as long as it breaks even. *
Price AND Quantity
1 point
(b) When the attendance is Q1, is the demand price elastic, inelastic, or unit elastic? Explain. *
EXPLAIN
0 points
(c) Assume that the price is set at P2. Assuming the existence of an opportunity cost, indicate whether the  museum’s accounting profits would be positive, negative, or zero. Explain. *
(d) Assume that the government decides the museum should charge no admission and agrees to subsidize the museum for any losses.
(i) Using the labeling on the graph, identify the museums attendance under that circumstance. *
(ii) Would the outcome be allocatively efficient? Explain *
Submit
Clear form
Never submit passwords through Google Forms.
This content is neither created nor endorsed by Google. Report Abuse - Terms of Service - Privacy Policy
Google Forms