Consider a monopolist who faces the following demand function Q 80 P 2 ( 2 is divided by the whole 80 P) The cost function of the monopolist is C 10 2Q 2 1 Find the profit maximising price and quantity 2 Find the consumer surplus and producer surplus 3 Suppose the government sets a price ceiling of P 70 How would this affect the profit

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Question: Consider a monopolist who faces the following demand function Q = 80- P/2 ( 2 is divided by the whole 80-P) The cost function of

Consider a monopolist who faces the following demand function Q = 80- P/2 ( 2 is divided by the whole 80-P) The cost function of the monopolist is C = 10+2Q²

1. Find the profit maximising price and quantity.

2. Find the consumer surplus and producer surplus.

3. Suppose the government sets a price ceiling of P = 70. How would this affect the profit?

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