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5. Suppose the total cost of q units produced by a profit-maximizing monopolist is given by C(q) =q² +8q On the demand side, suppose the aggregate demand is given by q=25 - p/4 a) Find the monopoly equilibrium. b) Find the firm's profit and the consumers' surplus in the monopoly equilibrium. c) Find the efficiency loss (or deadweight loss) of the monopoly allocation.

5. Suppose the total cost of q units produced by a profit-maximizing monopolist is given by C(q) =q² +8q On the demand side, suppose the aggregate demand is given by q=25 - p/4 a) Find the monopoly equilibrium. b) Find the firm's profit and the consumers' surplus in the monopoly equilibrium. c) Find the efficiency loss (or deadweight loss) of the monopoly allocation.

Microeconomic Theory
Microeconomic Theory
12th Edition
ISBN:9781337517942
Author:NICHOLSON
Publisher:NICHOLSON
Chapter14: Monopoly
Section: Chapter Questions
Problem 14.7P
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5. Suppose the total cost of q units produced by a profit-maximizing monopolist is given by C(q) =q² +8q On the demand side, suppose the aggregate demand is given by q=25-p/4 a) Find the monopoly equilibrium. b) Find the firm's profit and the consumers' surplus in the monopoly equilibrium. c) Find the efficiency loss (or deadweight loss) of the monopoly allocation.
Transcribed Image Text:5. Suppose the total cost of q units produced by a profit-maximizing monopolist is given by C(q) =q² +8q On the demand side, suppose the aggregate demand is given by q=25-p/4 a) Find the monopoly equilibrium. b) Find the firm's profit and the consumers' surplus in the monopoly equilibrium. c) Find the efficiency loss (or deadweight loss) of the monopoly allocation.
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