Suppose a local cable company provides cable service to a rural community. The figure to the right illustrates the cable company's marginal cost of providing cable service along with the community's demand for cable TV. Assume the local cable company is a monopoly. When the company maximizes profits, consumer surplus equals $ (enter a numeric response using a real number rounded to one decimal place), and producer surplus equals $ Compared to the perfectly competitive market outcome, the cable company creates dead weight loss equal to $ Price and cost (dollars per cable subscription) 120- 110- 100- 90- 80- 70- 60- 50- 40- 30 20- ཎྜ ༈༙ ྂ ཥཾ ྂ རྦྦ 8 8 ༤ 10- 0 10 MR 20 30 40 50 60 70 80 Quantity of cable subscriptions D MC 90 100
Suppose a local cable company provides cable service to a rural community. The figure to the right illustrates the cable company's marginal cost of providing cable service along with the community's demand for cable TV. Assume the local cable company is a monopoly. When the company maximizes profits, consumer surplus equals $ (enter a numeric response using a real number rounded to one decimal place), and producer surplus equals $ Compared to the perfectly competitive market outcome, the cable company creates dead weight loss equal to $ Price and cost (dollars per cable subscription) 120- 110- 100- 90- 80- 70- 60- 50- 40- 30 20- ཎྜ ༈༙ ྂ ཥཾ ྂ རྦྦ 8 8 ༤ 10- 0 10 MR 20 30 40 50 60 70 80 Quantity of cable subscriptions D MC 90 100
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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please answer in text form and in proper format answer with must explanation , calculation for each part and steps clearly
Transcribed Image Text:Suppose a local cable company provides cable service to a rural community. The figure to the
right illustrates the cable company's marginal cost of providing cable service along with
the community's demand for cable TV.
Assume the local cable company is a monopoly.
When the company maximizes profits, consumer surplus equals $ (enter a numeric response
using a real number rounded to one decimal place), and producer surplus equals $
Compared to the perfectly competitive market outcome, the cable company creates dead weight
loss equal to $
Price and cost (dollars per cable subscription)
120-
110-
100-
90-
80-
70-
60-
50-
40-
30
20-
ཎྜ ༈༙ ྂ ཥཾ ྂ རྦྦ 8 8 ༤
10-
0
10
MR
20 30 40 50 60 70 80
Quantity of cable subscriptions
D
MC
90 100
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