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Q (units) P ($) TC ($) 32 1 28 20 2 24 34 If the monopolist maximizes profit, then 3 20 48 4 16 62 12 76 profit will be O $8 O $10 $12 O none of the above

Q (units) P ($) TC ($) 32 1 28 20 2 24 34 If the monopolist maximizes profit, then 3 20 48 4 16 62 12 76 profit will be O $8 O $10 $12 O none of the above

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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### Profit Maximization for a Monopolist The table below displays data relevant to a monopolist's pricing and cost structure: | Q (units) | P ($) | TC ($) | |-----------|-------|--------| | 0 | 32 | 6 | | 1 | 28 | 20 | | 2 | 24 | 34 | | 3 | 20 | 48 | | 4 | 16 | 62 | | 5 | 12 | 76 | - **Q (units):** Quantity of goods produced - **P ($):** Price per unit - **TC ($):** Total cost #### Question: If the monopolist maximizes profit, then the profit will be _____. - ☐ $8 - ☐ $10 - ☐ $12 - ☐ none of the above #### Explanation: To determine the profit, calculate the total revenue (TR) and subtract the total cost (TC). The optimal quantity is where the difference (TR - TC) is maximized. Adjust calculations to find the correct option for maximum profit.
Transcribed Image Text:### Profit Maximization for a Monopolist The table below displays data relevant to a monopolist's pricing and cost structure: | Q (units) | P ($) | TC ($) | |-----------|-------|--------| | 0 | 32 | 6 | | 1 | 28 | 20 | | 2 | 24 | 34 | | 3 | 20 | 48 | | 4 | 16 | 62 | | 5 | 12 | 76 | - **Q (units):** Quantity of goods produced - **P ($):** Price per unit - **TC ($):** Total cost #### Question: If the monopolist maximizes profit, then the profit will be _____. - ☐ $8 - ☐ $10 - ☐ $12 - ☐ none of the above #### Explanation: To determine the profit, calculate the total revenue (TR) and subtract the total cost (TC). The optimal quantity is where the difference (TR - TC) is maximized. Adjust calculations to find the correct option for maximum profit.
### Monopolist Demand and Cost Analysis Consider a monopolist that faces a demand schedule and has total costs depicted in the table below. If the monopolist maximizes profit, then the market price will be ______. #### Table: Demand and Total Cost Schedule | Q (units) | P ($) | TC ($) | |-----------|-------|--------| | 0 | 32 | 6 | | 1 | 28 | 20 | | 2 | 24 | 34 | | 3 | 20 | 48 | | 4 | 16 | 62 | | 5 | 12 | 76 | ### Question If the monopolist maximizes profit, then the market price will be: - ☐ $16 - ☐ $20 - ☐ $24 - ☐ none of the above ### Explanation - **Q (units):** Quantity of goods produced - **P ($):** Price per unit - **TC ($):** Total cost of production The monopolist aims to choose a quantity where marginal cost (MC) equals marginal revenue (MR) to maximize profit. Calculate this from the change in total cost and price for each quantity increment. ### Answer Options Evaluate each option to determine the correct market price maximizing profit.
Transcribed Image Text:### Monopolist Demand and Cost Analysis Consider a monopolist that faces a demand schedule and has total costs depicted in the table below. If the monopolist maximizes profit, then the market price will be ______. #### Table: Demand and Total Cost Schedule | Q (units) | P ($) | TC ($) | |-----------|-------|--------| | 0 | 32 | 6 | | 1 | 28 | 20 | | 2 | 24 | 34 | | 3 | 20 | 48 | | 4 | 16 | 62 | | 5 | 12 | 76 | ### Question If the monopolist maximizes profit, then the market price will be: - ☐ $16 - ☐ $20 - ☐ $24 - ☐ none of the above ### Explanation - **Q (units):** Quantity of goods produced - **P ($):** Price per unit - **TC ($):** Total cost of production The monopolist aims to choose a quantity where marginal cost (MC) equals marginal revenue (MR) to maximize profit. Calculate this from the change in total cost and price for each quantity increment. ### Answer Options Evaluate each option to determine the correct market price maximizing profit.
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