Use the following table to answer the following three questions. Demand: Quantity 1 2 3 4 5 6 7 8 9 10 Price 10 9 8 7 6 5 4 3 2 1 Marginal Revenue 10 8 6 4 2 0 -2 -4 -6 -8 Costs: Marginal Cost 9 6 5 3 2 3 4 5 7 10 Average Cost 9 7.5 6.7 5.8 5 4.7 4.6 4.6 4.9 5.4 If the transit system was allowed to operate as an unregulated monopoly, what output would it supply and what price would it change? If the transit system was regulated to operate with no subsidy ( i.e., at zero economic profit ), what approximate output would it supply and what approximate price would it charge? If the transit system was regulated to provide the most allocatively efficient quantity of output. what output would it supply and what price would it charge? What subsidy would be necessary to insure this effient provision of transit services ?
Use the following table to answer the following three questions.
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