Question

A monopolist’s inverse demand function is P = 150 - 3Q. The company produces output at two facilities; the marginal cost of producing at facility 1 is MC1 (Q1) = 6Q1, and the marginal cost of producing at facility 2 is MC2 (Q2) = 2Q2.
a. Provide the equation for the monopolist’s marginal revenue function.
b. Determine the profit- maximizing level of output for each facility.
c. Determine the profit- maximizing price.



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  • CreatedApril 18, 2014
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