Microeconomics
11th Edition
ISBN: 9781260507140
Author: David C. Colander
Publisher: McGraw Hill Education
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Question
Chapter 14.A, Problem 2QE
a)
To determine
The profit-maximizing level of price and output for a monopolist.
b)
To determine
The average cost of the firm.
c)
To determine
Total profit of the firm.
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Suppose the demand curve for a monopolist is QD = 400 - P, and the marginal revenue function is MR = 400 - 2Q. The monopolist has a constant marginal and average total cost of $40 per unit.
a. Find the monopolist's profit-maximizing output and price. Show on a graph.
b. Calculate the monopolist's profit.
Suppose there is a monopolist in the market for a specific video game facing a demand
curve: P = 20-0.5Q with MR = 20 - Q. The monopolist marginal cost curve is MC = 4, its
total variable costs are TVC = 4Q and it faces a total fixed costs equal TFC = $102.
a. What is the optimal quantity to maximize profit?
b. What is the optimal price to maximize profit?
c. What is the profit for the monopoly?
d. What is the consumer surplus?
There are two groups of consumers. In the first group, each consumer has the inverse demand function P = 40 – Q. In the second group, each consumer has the inverse demand function P = 20 – Q. There are 10 consumers in each group, or 20 consumers in all. Marginal cost is always zero. The monopolist wants to maximize profits by designing a two-part tariff. Calculate the two parts of the tariff, and calculate profits.
Chapter 14 Solutions
Microeconomics
Ch. 14.1 - Prob. 1QCh. 14.1 - Prob. 2QCh. 14.1 - Prob. 3QCh. 14.1 - Prob. 4QCh. 14.1 - Prob. 5QCh. 14.1 - Prob. 6QCh. 14.1 - Prob. 7QCh. 14.1 - Prob. 8QCh. 14.1 - Prob. 9QCh. 14.1 - Prob. 10Q
Ch. 14.A - Prob. 1QECh. 14.A - Prob. 2QECh. 14.A - Prob. 3QECh. 14.A - Prob. 4QECh. 14 - Prob. 1QECh. 14 - Prob. 2QECh. 14 - Prob. 3QECh. 14 - Prob. 4QECh. 14 - Prob. 5QECh. 14 - Prob. 6QECh. 14 - Prob. 7QECh. 14 - Prob. 8QECh. 14 - Prob. 9QECh. 14 - Prob. 10QECh. 14 - Prob. 11QECh. 14 - Prob. 12QECh. 14 - Prob. 13QECh. 14 - Prob. 14QECh. 14 - Prob. 15QECh. 14 - Prob. 16QECh. 14 - Prob. 17QECh. 14 - Prob. 18QECh. 14 - Prob. 19QECh. 14 - Prob. 20QECh. 14 - Prob. 21QECh. 14 - Prob. 22QECh. 14 - Prob. 23QECh. 14 - Prob. 24QECh. 14 - Prob. 25QECh. 14 - Prob. 1QAPCh. 14 - Prob. 2QAPCh. 14 - Prob. 3QAPCh. 14 - Prob. 4QAPCh. 14 - Prob. 5QAPCh. 14 - Prob. 6QAPCh. 14 - Prob. 7QAPCh. 14 - Prob. 1IPCh. 14 - Prob. 2IPCh. 14 - Prob. 3IPCh. 14 - Prob. 4IPCh. 14 - Prob. 5IPCh. 14 - Prob. 6IPCh. 14 - Prob. 7IPCh. 14 - Prob. 8IPCh. 14 - Prob. 9IP
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