Suppose a monopolist faces a market inverse demand p = 10-Q , and its marginal cost is
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Question:
Suppose a monopolist faces a market inverse demand p = 10-Q, and its marginal cost
is constant at 4. Assume its fixed cost at zero.
d) Identify on your graph and calculate the social surplus under monopoly
e) How much would this firm produce if it behaved competitively?
f) Identify on your graph and calculate the social surplus if the firm behaved competitively.
g) Identify on your graph and calculate the deadweight loss.
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