2) A monopoly faces a demand elasticity of -10 and marginal cost of $2, what is the optimal monopoly price? (Calculate using the monopoly pricing formula) What is the Lerner index?

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Chapter25: Monopoly
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2) A monopoly faces a demand elasticity of -10 and marginal cost of $2, what is the optimal monopoly
price? (Calculate using the monopoly pricing formula) What is the Lerner index?
Transcribed Image Text:2) A monopoly faces a demand elasticity of -10 and marginal cost of $2, what is the optimal monopoly price? (Calculate using the monopoly pricing formula) What is the Lerner index?
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