Question: A firm with a cost function C(y) = 2y2 is confronted with an inverse market demand function P (y) = 160=6y. The supply function under

A firm with a cost function C(y) = 2y2 is confronted with an inverse market

demand function P (y) = 160=6y. The supply function under perfect competition

is identical to the monopolist’s marginal-cost function.

1. The producer surplus with perfect competition and with symmetric firms is 768.

2. The producer surplus in a monopoly without price discrimination is 800.

3. The deadweight loss in a monopoly without price discrimination is 80.

4. The consumer surplus in a monopoly without price discrimination is 50.

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