Short Answer #3 Consider the market for iPhones. The demand curve is given as MB = 400 - 2Q, and supply is given as MC = 100+ Q. iPhones are produced by Apple, which holds a monopoly on their sale. However, the iPhone assembly process creates some air pollution. The damages from the air pollution are given as MD = Q. a. Compute the equations for marginal revenue (MR) and marginal social cost ( MCs). Question 25 b. Given the information above, calculate the social optimum (P* and Q*). Question 26 c. Calculate the equilibrium under monopoly (quantity Q and price PM).
Short Answer #3 Consider the market for iPhones. The demand curve is given as MB = 400 - 2Q, and supply is given as MC = 100+ Q. iPhones are produced by Apple, which holds a monopoly on their sale. However, the iPhone assembly process creates some air pollution. The damages from the air pollution are given as MD = Q. a. Compute the equations for marginal revenue (MR) and marginal social cost ( MCs). Question 25 b. Given the information above, calculate the social optimum (P* and Q*). Question 26 c. Calculate the equilibrium under monopoly (quantity Q and price PM).
Chapter28: Antitrust And Regulation
Section: Chapter Questions
Problem 4E
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Transcribed Image Text:Short Answer #3
Consider the market for iPhones. The demand curve is given as MB = 400 -
2Q, and supply is given as MC = 100+ Q. iPhones are produced by Apple,
which holds a monopoly on their sale. However, the iPhone assembly process
creates some air pollution. The damages from the air pollution are given as
MD = Q.
a. Compute the equations for marginal revenue (MR) and marginal social cost (
MCs).
Question 25
b. Given the information above, calculate the social optimum (P* and Q*).
Question 26
c. Calculate the equilibrium under monopoly (quantity Q and price PM).
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