Suppose a monopolist faces a market inverse demand p = 10-Q , and its marginal cost is
Fantastic news! We've Found the answer you've been seeking!
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.
a) Draw on the same graph the monopolist’s demand, MR, and MC curves/lines.
b) Calculate the profit maximizing monopoly price, output, and profit.
c) Calculate the Lerner index at the monopoly price, as well as the price elasticity at
the monopoly output.
Related Book For
Posted Date: