I have no idea how to find the Lerner index. Could I have help understanding the first parts needed in order to find it? A monopolist has the following average revenue and long-run average cost equations:AC = c(a > 0, b > 0, 0 c. Find and simplify expressions for maximum profit and deadweight loss.In thisthat eaBegin wexampn* =DWL =The mfirmsd. GRAPH: Sketch and label MR, AR, MC, and AC. Mark UIIN and DWL [1u-a. Fe. Find expressions for marginal revenue and point elasticity of demand at the equilibrium output, andshow that demand is elastic at this output. Also calculate the value of the Lerner Index for this firm.MR* =ED* =ns.uest OGusuo Lerner Index =

The above question is based on the relations between different types of costs involved in the…

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A monopolist has the following average révenue and lon AR = a - bQ AC = C (a > 0, b > 0, 0

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Question

I have no idea how to find the Lerner index. Could I have help understanding the first parts needed in order to find it?

A monopolist has the following average revenue and long-run average cost equations:
AC = c
(a > 0, b > 0, 0 <c< a)
AR = a - bQ
%3D
a. Write the equations of TR, MR, TC, MC, and (profit).
TR =
TC =
MR =
MC =
b. Find and simplify expressions for profit-maximizing output and price.
%3D
P* =

c. Find and simplify expressions for maximum profit and deadweight loss.
In this
that ea
Begin w
examp
n* =
DWL =
The m
firms
d. GRAPH: Sketch and label MR, AR, MC, and AC. Mark UIIN and DWL [1u-
a. F
e. Find expressions for marginal revenue and point elasticity of demand at the equilibrium output, and
show that demand is elastic at this output. Also calculate the value of the Lerner Index for this firm.
MR* =
ED* =
ns.
uest OGusuo Lerner Index =

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