# What kind of market would describe the museum?

The residents of the town Ectenia all love economics and the mayor proposes building an economics m Show more The residents of the town Ectenia all love economics and the mayor proposes building an economics museum. The museum has a fixed cost of \$2400000 and no variable costs. There are 100000 town residents and each has the same demand for museum visits: where is the price of admission. On the following graph use green points (triangle symbol) to graph the museums average-total-cost curve at the following quantities: 1000 visits 3000 visits 4000 visits 6000 visits 8000 visits and 12000 visits. Then use the orange line (square symbol) to graph the museums marginal-cost curve. What kind of market would describe the museum? Single-price monopoly Natural monopoly Perfectly competitive market The mayor proposes financing the museum with a lump-sum tax of \$24 and then opening the museum to the public for free. Under this system each person would visit ______ times. The benefit each person would get from the museum would be __\$. (Hint: You can measure the benefit as consumer surplus minus the new tax.) The mayors anti-tax opponent says the museum should finance itself by charging an admission fee. The lowest price the museum can charge without incurring losses is ____\$. (Hint: Find the number of visits and museum profits for prices of \$2 \$3 \$4 and \$5.) At this price each residents consumer surplus is____\$. Which of the following statements are true? Check all that apply. Revenue per person is the same regardless of whether an admission fee or the mayors plan is used. Consumers are worse off with the admission fee than under the mayors plan. Total societal welfare is better with the admission fee than under the mayors plan. Show less
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