Pls solve sub questions 1, 2 and 3 only Suppose that the monopolist faces a lineardemand curve, P(Q) = A — BQ. Furthersuppose that the monopolist has the marginalcost function: MC = Q.1. Find the revenue as a function of Q.2. Find the marginal revenue as a function of Q.3. Find the quantity that maximizes themonopolist's profit as a function of A and B.4. Find the equilibrium price as a function of Aand B.5. Let's use some numbers. Suppose A= = 10and B = 2. Solve for the profit-maximizingquantity and price.6. Using A = 10 and B = 2, draw a demandcurve and a marginal revenue function aswell as marginal cost. Shade the deadweightloss. Also label clearly the profit-maximizingquantity and price chosen by the monopolist.7. What would have been the competitiveequilibrium price and quantity (hint: equateMC and the demand function)? Label thecompetitive equilbrium point. Also computethe size of the deadweight loss due toinefficiency casued by the monopolistbehavior.

Monopoly is a form of market structure in which a single firm sells a commodity for which there are…

Suppose that the monopolist faces a linear demand curve, P(Q) = A – BQ. Further suppose that the monopolist has the marginal cost function: MC = Q. 1. Find the revenue as a function of Q. 2. Find the marginal revenue as a function of Q. 3. Find the quantity that maximizes the monopolist's profit as a function of A and B.

Suppose that the monopolist faces a linear demand curve, P(Q) = A – BQ. Further suppose that the monopolist has the marginal cost function: MC = Q. 1. Find the revenue as a function of Q. 2. Find the marginal revenue as a function of Q. 3. Find the quantity that maximizes the monopolist's profit as a function of A and B.

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter9: Monopoly

Section: Chapter Questions

Problem 15SQ

See similar textbooks

Similar questions

A monopolist has a cost function given by c(y) = y2 and faces a demand curve given by P(y) = 120 − y. a. What is his profit-maximizing level of output? What price will the monopolist charge? b. Suppose you put a lump sum tax of $100 on this monopolist. What would its output be? c. If you wanted to choose a price ceiling for this monopolist so as to maximize consumer plus producer surplus, what price ceiling should you choose? How much output will the monopolist produce at this price ceiling?
Economics Consider the following cost function faced by the monopolist: TC(q)= 2q2+20q+10. The demand faced by the monopolist is the following: p(q)=200-10q, where q denotes quantity and p denotes price. Find the price and quantity that maximizes profit of the monopolist. If the monopolist becomes a perfectly price discriminating monopolist, calculate the Consumer Surplus and Producer Surplus.
A monopolist can produce at constant average total and marginal cost of ATC = MC = $20. (Constant ATC = MC implies that there are no fixed costs.) The firm faces a market demand curve given by QD = 40 - P. The monopolist's marginal revenue curve is given by MR = 40 - 2QD. Graph this situation, then calculate the monopolist's profit-maximizing price-quantity and the monopolist's profits. What output level would be produced by a corresponding perfectly competitive industry? What would be the price level? Calculate the "deadweight losses" from monopolization of the industry. Show the DWL on the graph.
Suppose you are a monopolist in the market for a specific Q video game. Your demand curve is given by P = 80- - and 2 your marginal cost curve is MC = Q. Your fixed cost is $400. i) Derive the marginal revenue curve. ii) Calculate the equilibrium price and quantity. iii) What is the profit?
A single price monopolist has a cost function of c(Q) = 10 + Q, where Q is output. It faces the following demand curve: Q°(p) = 0, if p > 24 and Q°(p) = 120/p, if p s 24. What is the profit-maximizing choice of output? The profit maximizing choice of output is = At this optimum level of output, calculate the consumer surplus. In addition, by drawing a graph, show the area representing the producer surplus (label it by PS) and the area representing the deadweight loss (label it by DWL). Calculate the values of producer surplus and deadweight loss.
A monopolist faces the demand function P= 10 - Qand the total cost function TC = %3D 2Q. Showing all your workings, calculate the maximum profit earned by the monopolist from using a two-part tariff.
Consider a monopolist facing an inverse demand function p(q) = 15 – 3q, where q denotes units of output. Assume that the total cost of this firm is TC(q) = 5 + 4q. i. Find the monopolists marginal revenue and its marginal cost Find the monopolists optimal output q", price, and profits Assume now that the market operated under perfect competition. Compute the equilibrium output, price, and profits i. iii.
A monopolist faces the following aggregate demand function: Q = 28 – 1/2 P. Total production costs for the firm are TC(Q) = 40Q. Calculate the consumer surplus, producer surplus, and profits in equilibrium. Then, suppose that the monopolist decides to spend 10 to purchase a patent that would allow her to decrease total costs by 4 per unit. Find the new equilibrium quantity, price, new consumer surplus, producer surplus, and profits to the monopolist after the purchase of the patent.
Suppose a monopolist faces a demand equation given by P=20-Q, and a marginal revenue equation given by MR = 20-2Q, and MC=AVC=ATC=$6. What is the deadweight loss associated with the monopolist? a) $8.5 b) $33.25 c) $24.5 d) $12.5
Answer it correctly please...
Exercise A.3. The inverse demand of a monopolist is given by the expression P=50-2Q and its cost function is C(Q)=Q²+20Q+20. a) Determine the level of production, price and profit of the monopolist. Represent graphically. b) Calculate the monopoly power of the company using the Lerner index. c) Calculate the value of the deadweight loss caused by monopoly power.
A movie monopolist sells to college students and other adults. The demand function for students is QdS-840-100P, and the demand function for other adults is QdA=1,800-100P. Costs is C(Q)=1Q+0.005Q2mper ticket, where Q = QS + QA. Instructions: Round your answers to 2 decimal places. a. What prices will the monopolist set when she can discriminate? Pstudent = $ per ticket.