1. Refer to the figure below when the firm is a monopolist.PricePMCLKJATCDT WQuaxtity\MRa) If the monopolist maximizes profit, how many units will it produce?b) What price will the monopolist charge?c) What area measure the monopolist's profit?d) What level of output would be socially efficient?2. A Monopolist is facing a demand schedule that is shown in the following table.QuantityTotal RevenueAverageRevenueMarginal RevenuePrice$35$32123$2914$2615$23$20$17$14671819$1110$8a) Fill out the rest of the table.b) Assume this monopolist's marginal cost is constant at $11. What quantity of output (Q) will itproduce and what price (P) will it charge?------

1. Refer to the figure below when the firm is a monopolist. Price P MC L K J ATC D T W Quaxtity \MR a) If the monopolist maximizes profit, how many units will it produce? b) What price will the monopolist charge? c) What area measure the monopolist's profit? d) What level of output would be socially efficient?

1. Refer to the figure below when the firm is a monopolist. Price P MC L K J ATC D T W Quaxtity \MR a) If the monopolist maximizes profit, how many units will it produce? b) What price will the monopolist charge? c) What area measure the monopolist's profit? d) What level of output would be socially efficient?

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter14: Monopoly

Section: Chapter Questions

Problem 14.2P

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Similar questions

Imagine that you ale managing a small firm and thinking about entering the market of a monopolist. The monopolist is currently charging a high price, and you have calculated that you can make a nice profit charging 10 less than the monopolist. Before you go ahead and challenge the monopolist, what possibility should you consider for how the monopolist might react?
Draw a monopolists demand curve, marginal revenue, and marginal cost curves. Identify the monopolists profit-maximizing output level. Now, think about a slightly higher level of output (sayQ0+1). According to the graph, is there any consumer willing to pay more than the marginal cost of that new level of output? If so, what does this mean?
What is the usual shape of a marginal revenue cuwe for a monopolist? Why?
How does the demand curve perceived by a monopolist compare with the market demand curve?
What is the usual shape of a total revenue curve for a monopolist? Why?
How can a monopolist identify the profit-maximizing level of output if it knows its total revenue and total cost curves?