Problem 3Consider a country called Midwest and is run by a monopolist. Market demand isP = 35 – 4xQp and the monopolist's cost curve is MC = 7 + Qs.a) What is the slope of the monopolist's marginal revenue curve?а. -3b. -1c. -6d. 0e. -8b) What is the monopolist's revenue in equilibrium in autarky?c) Compute consumer surplus in the autarkic equilibrium.For d)-h), suppose export supply is perfectly elastic at PW= 10d) Compute the monopolist's revenue in the free trade equilibrium.e) Compute the increase in consumer surplus by opening up to free trade.f) Compute the quantity imported in free trade.g) Suppose a tariff of 2 is placed on imports. Compute the new quantity imported.h) Consider an import quota equal to your answer in (g). Which statement is most likely:a. Consumer surplus will be higher with the quota than with the tariffb. Consumer surplus will be lower with the quota than with the tariffc. Consumer surplus will be the same with the quota and with the tariff

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Problem 3 Consider a country called Midwest and is run by a monopolist. Market demand is P = 35 – 4×Q, and the monopolist's cost curve is MC =7+ Qs. a) What is the slope of the monopolist's marginal revenue curve? а. -3 b. -1 с. -6 d. 0 е. -8 b) What is the monopolist's revenue in equilibrium in autarky? c) Compute consumer surplus in the autarkic equilibrium. For d)-h), suppose export supply is perfectly elastic at P"= 10 d) Compute the monopolist's revenue in the free trade equilibrium.

Problem 3 Consider a country called Midwest and is run by a monopolist. Market demand is P = 35 – 4×Q, and the monopolist's cost curve is MC =7+ Qs. a) What is the slope of the monopolist's marginal revenue curve? а. -3 b. -1 с. -6 d. 0 е. -8 b) What is the monopolist's revenue in equilibrium in autarky? c) Compute consumer surplus in the autarkic equilibrium. For d)-h), suppose export supply is perfectly elastic at P"= 10 d) Compute the monopolist's revenue in the free trade equilibrium.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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