2.)Market demand in a monopolistic market is represented by P = 40,000 - 2Q with the P as the market price while Q is the market output. Using this demand function, the relevant marginal revenue function will be MR = 40,000 - 4Q. The monopolist' total cost function is given as TC = 50,000,000 + 2Q + 0.5Q? with TC as the total cost level and Q as the output of the monopolist. Relevant marginal cost function will be MC = 2 + Q. Use the information provided in this item to answer the following questions. %3D i.)What is the profit maximizing output and price for this monopolist? What is the maximum profit level of this monopolist? ii.)What is(are) the break even quantity(ies) of this monopolist? iii.)Do you agree that this monopolist is over pricing and under producing? Answer yes or no but justify your answer by comparing the price and output under perfect competition.

2.)Market demand in a monopolistic market is represented by P = 40,000 - 2Q with the P as the market price while Q is the market output. Using this demand function, the relevant marginal revenue function will be MR = 40,000 - 4Q. The monopolist' total cost function is given as TC = 50,000,000 + 2Q + 0.5Q? with TC as the total cost level and Q as the output of the monopolist. Relevant marginal cost function will be MC = 2 + Q. Use the information provided in this item to answer the following questions. %3D i.)What is the profit maximizing output and price for this monopolist? What is the maximum profit level of this monopolist? ii.)What is(are) the break even quantity(ies) of this monopolist? iii.)Do you agree that this monopolist is over pricing and under producing? Answer yes or no but justify your answer by comparing the price and output under perfect competition.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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