Page 29 - FINAL CFA I SLIDES JUNE 2019 DAY 5
P. 29
Session Unit 4:
15. The Firm & Market Structures
LOS 15.b: Explain relationships between price, marginal revenue, marginal cost, economic profit, and the
elasticity of demand under each market structure,
LOS 15.d: Describe and determine the optimal price and output for firms under each market structure.
LOS 15.e: Explain factors affecting long-run equilibrium under each market structure.
Figure 22: Natural Monopoly—Average Cost and Marginal Cost Pricing, p39
Both increase output and reduce price/DWL
Allocative efficiency
Efficient regulation!
