2 A monopolist faces market demand Q = 30 - P, and has a marginal cost curve equalto MC = Q. I have computed the marginal revenue curve fro you which is given byMR = 30 - 2Q.1. If the firm is a single price monopolist, find the profit maximizing price andquantity and the resulting profit to the monopoly.2. What is the socially optimal price and quantity? What is the firm's profit atthis price and quantity?3. Show (1) and (2) on a graph.4. Calculate consumer surplus (CS) and producer surplus (PS) and total surplusfor parts (1) and (2). Show CS, PS, and DWL on the graph. Calculate the DWLdue to monopoly.5. If the firm engages in first degree price discrimination, find the profitmaximizing quantity and the resulting profit to the monopoly.6. Between (1) and (5), which pricing scheme is preferred by the monopolist andwhich by the consumers? why?

Given Market demand equation Q=30-P ..... (1) Marginal cost curve MC=Q…

A monopolist faces market demand Q = 30 - P, and has a marginal cost curve equal to MC = Q. I have computed the marginal revenue curve fro you which is given by MR = 30 - 2Q. 1. If the firm is a single price monopolist, find the profit maximizing price and quantity and the resulting profit to the monopoly. 2. What is the socially optimal price and quantity? What is the firm's profit at this price and quantity? 3. Show (1) and (2) on a graph.

A monopolist faces market demand Q = 30 - P, and has a marginal cost curve equal to MC = Q. I have computed the marginal revenue curve fro you which is given by MR = 30 - 2Q. 1. If the firm is a single price monopolist, find the profit maximizing price and quantity and the resulting profit to the monopoly. 2. What is the socially optimal price and quantity? What is the firm's profit at this price and quantity? 3. Show (1) and (2) on a graph.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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