Question: 2) (22 Total Points) Suppose a monopolist's production function is given by q = MIN(SL, K). The price of Labor is w = $15, and

$15, and the price of Capital is r = $4. Also, the

Market Demand is given by P = 207 - 5Q. a) (4

points) What is the firm's Total Cost function? TC(q) = b) (2

2) (22 Total Points) Suppose a monopolist's production function is given by q = MIN(SL, K). The price of Labor is w = $15, and the price of Capital is r = $4. Also, the Market Demand is given by P = 207 - 5Q. a) (4 points) What is the firm's Total Cost function? TC(q) = b) (2 points) What is the firm's Marginal Cost? MC = c) (2 points) How much output should the firm produce to maximize profit? OM =d) (2 points) What price will the firm charge if it maximizes profit? PM = e) (4 points) How much Labor and Capital will the firm hire? L* = K * = f) (2 points) What is the value of Consumer Surplus in this market? CS = g) (2 points) What is the value of Producer Surplus in this market? PS = h) (2 points) What is the deadweight loss that results from this market? DWL =i) (2 points) What is the value of the Lerner Index? Lerner Index =

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