EBK ECONOMICS
20th Edition
ISBN: 9780077660710
Author: McConnell
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Question
Chapter 12, Problem 5P
Sub Part (a):
To determine
Classifying decreasing cost industry.
Sub part (b):
To determine
Socially optimal price .
Sub part (c):
To determine
Breakeven point.
Sub part (d):
To determine
Profit.
Sub Part (e):
To determine
Price that earns Normal profit.
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Students have asked these similar questions
1. At what output rate and price does the monopolist operate?
2. In equilibrium, approximately what is the firm’s total cost and total revenue?
3. What is the firm’s economic profit or loss in equilibrium?
Ignore AFC and AVC
2. Suppose a pure monopolist faces the following demand schedule and the same cost data as the competitive producer discussed in
problem 4 at the end of Chapter 10. Calculate the missing TR and MR amounts, and determine the profit-maximizing price and
profit-maximizing output for this monopolist. What is the monopolist's profit? Verify your answer graphically and by comparing total
revenue and total cost. LO11.4
Average
Total
Average
Variable
Average
Marginal
Product
Fixed Cost
Cost
Total Cost
Cost
0
$45
1
$60.00
$45.00
$105.00
40
2
30.00
42.50
72.50
35
3
20.00
40.00
60.00
30
4
15.00
37.50
52.50
35
5
12.00
37.00
49.00
40
6
10.00
37.50
47.50
45
7
8.57
38.57
47.14
55
8
7.50
40.63
48.13
65
9
6.67
43.33
50.00
75
10
6.00
46.50
52.50
Price Quantity Demanded Total Revenue Marginal Revenue
$115
83
63
55
48
42
29
2 % 522332
100
0
1
2
3
4
5
6
7
37
8
9
10
$
1.
The table below represents the demand for Widgets, Inc., which has a
monopoly in the sale of widgets. Calculate total revenue and marginal
revenue for the levels of output given. Draw the demand curve and the
marginal revenue curve in a same graph.
Quantity
0
1
2
3
4
LO
5
Price
$25
21
17
13
9
LO
5
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