11. A monopolist is faced with the following cost and revenue curves:(a) What is the maximum-profit output?80MC(b) What is the maximum-profit price?70(c)What is the total revenue at this priceand output?6050AÇ(d) What is the total cost at this price andoutput?4030(e) What is the level of profit at this priceand output?20AR() If the monopolist were ordered toproduce 300 units, what would be themarket price?10100200300403500600(2) How much profit would now be made?-10MR(h) If the monopolist were faced with thesame demand, but average costs wereconstant at £60 per unit, what outputwould maximise profit?-20QuantityWhat would be the price now?.How much profit would now be made?.(k) Assume now that the monopolist decides not to maximise profits, but instead sets a price of£40. How much will now be sold?O What is the marginal revenue at this output?(m) What does the answer to (1) indicate about total revenue at a price of £40?(n) What is the price elasticity of demand at a price of £40? (You do not need to do a calculationto work this out: think about the relationship between MR and TR.)

11. A monopolist is faced with the following cost and revenue curves: (a) What is the maximum-profit output? 80 MC (b) What is the maximum -profit price? 70 (e) What is the total revemue at this price and output? 60 50 (d) What is the total cost at this price and output? AÇ 40 30 (e) What is the level of profit at this priece and output? 20 AR (Đ If the monopolist were ordered to produce 300 units, what would be the market price? 10 100 200 300 40 500 (2) How much profit would now be made? -10 MR (h) If the monopolist were faced with the same demand, but average costs were -20 Quantity

11. A monopolist is faced with the following cost and revenue curves: (a) What is the maximum-profit output? 80 MC (b) What is the maximum -profit price? 70 (e) What is the total revemue at this price and output? 60 50 (d) What is the total cost at this price and output? AÇ 40 30 (e) What is the level of profit at this priece and output? 20 AR (Đ If the monopolist were ordered to produce 300 units, what would be the market price? 10 100 200 300 40 500 (2) How much profit would now be made? -10 MR (h) If the monopolist were faced with the same demand, but average costs were -20 Quantity

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter15: Monopoly

Section: Chapter Questions

Problem 7PA

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Similar questions

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What is the usual shape of a marginal revenue cuwe for a monopolist? Why?
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What is the usual shape of a total revenue curve for a monopolist? Why?
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?
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