A profit maximizing monopolist has a cost function C (g) = 2g, where q > 0 denotes the amount produced, and faces the aggregate demand curve %3D 100/p where p > 0 denotes the price per unit in the market. Assume that = 6 the monopolist chooses an optimal price in the range [1, 6]. The optimal price the monopolist would set up is _ while the Lerner index is Blank # 1 Blank # 2

Economics:
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ISBN:9781285859460
Author:BOYES, William
Publisher:BOYES, William
Chapter28: Antitrust And Regulation
Section: Chapter Questions
Problem 8E
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A profit maximizing monopolist has a cost function C (q) = 2g, where q > 0
denotes the amount produced, and faces the aggregate demand curve
q = 100/p² where p > 0 denotes the price per unit in the market. Assume that
the monopolist chooses an optimal price in the range [1, 6]. The optimal price the
monopolist would set up is
while the Lerner index is
Blank # 1
Blank # 2
Transcribed Image Text:A profit maximizing monopolist has a cost function C (q) = 2g, where q > 0 denotes the amount produced, and faces the aggregate demand curve q = 100/p² where p > 0 denotes the price per unit in the market. Assume that the monopolist chooses an optimal price in the range [1, 6]. The optimal price the monopolist would set up is while the Lerner index is Blank # 1 Blank # 2
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