Problem 2.3. Monopoly with increasing marginalcost (15 points) A firm with cost function 2 CQ Q ()0.50 = is a monopoly in a market where theinverse demand function is pQ Q ( ) 120 2 = - . (a)Find the monopolist's marginal revenue andmarginal cost. (b) Find the monopolist's profit-maximizing quantity and priceUpdate: C(q)=.5q^2 and P(q)=120-2q

profit maximization is the short run or long run process by which a firm may determine the price,…

ost (15 points) A firm with cost function 2 CQ Q .50 = is a monopoly in a market where the verse demand function is pQQ( ) 120 2 = - ( nd the monopolist's marginal revenue and arginal cost. (b) Find the monopolist's profit-

ost (15 points) A firm with cost function 2 CQ Q .50 = is a monopoly in a market where the verse demand function is pQQ( ) 120 2 = - ( nd the monopolist's marginal revenue and arginal cost. (b) Find the monopolist's profit-

ENGR.ECONOMIC ANALYSIS

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Chapter1: Making Economics Decisions

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Question

Problem 2.3. Monopoly with increasing marginal
cost (15 points) A firm with cost function 2 CQ Q ()
0.50 = is a monopoly in a market where the
inverse demand function is pQ Q ( ) 120 2 = - . (a)
Find the monopolist's marginal revenue and
marginal cost. (b) Find the monopolist's profit-
maximizing quantity and price
Update: C(q)=.5q^2 and P(q)=120-2q

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