Question: A) Suppose a monopolist has the total cost function C = Q^2 + 12 and the demand curve it faces is p = 24 -Q.

A) Suppose a monopolist has the total cost function C = Q^2 + 12 and the demand curve it faces is p = 24 -Q. What will be he price, quantity and profit for this firm? What will be the price and quantity for a competitive market in this case?

(C). Continue with the same monopoly example from part (B). Now, suppose government imposes a price ceiling of $16 as optimal regulation policy (see diagram below). Calculate the changes in consumer surplus, producer surplus, welfare and deadweight loss that result from this policy (actual values). [6 points] P MC B D E MR D O

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