A monopolist faces demand p(Q) = 65-2Q and has total cost TC(Q) = 100 +5Q+Q 2 . a. Calculate price, quantity and (producer and consumer) surplus under perfect competition. b. Determine the profit - maximizing price, quantity, and profit for the monopolist. c. Calculate consumer surplus, producer surplus and deadweight loss under monopoly. d. How would a price ceiling of $27 affect price, quantity, producer and consumer surplus, and deadweight loss?
A monopolist faces demand p(Q) = 65-2Q and has total cost TC(Q) = 100 +5Q+Q 2 . a. Calculate price, quantity and (producer and consumer) surplus under perfect competition. b. Determine the profit - maximizing price, quantity, and profit for the monopolist. c. Calculate consumer surplus, producer surplus and deadweight loss under monopoly. d. How would a price ceiling of $27 affect price, quantity, producer and consumer surplus, and deadweight loss?
Chapter14: Monopoly
Section: Chapter Questions
Problem 14.1P
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Transcribed Image Text:A monopolist faces demand p(Q) = 65-2Q and has
total cost TC(Q) = 100 +5Q+Q
2
. a. Calculate price, quantity and (producer and
consumer) surplus under perfect competition. b.
Determine the profit - maximizing price, quantity,
and profit for the monopolist. c. Calculate consumer
surplus, producer surplus and deadweight loss under
monopoly. d. How would a price ceiling of $27
affect price, quantity, producer and consumer
surplus, and deadweight loss?
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