Gert, a monopolist, owns a glass factory where he produces high-quality windows. The machine, which Gert uses for this purpose, costs 5000 DK to operate regardless of how many windows it produces. Furthermore, there is material and electricity costs equivalent to 400 DKK per produced unit. The market demand is characterized by the following function: PD = -200Q +10000 Question A: What is the functional expression for Gert's total revenue (TR), total costs (TC), marginal costs (MC) and marginal revenue (MR)? Question B: What is Gert's optimal price, quantity and profit?

Gert, a monopolist, owns a glass factory where he produces high-quality windows. The machine, which Gert uses for this purpose, costs 5000 DK to operate regardless of how many windows it produces. Furthermore, there is material and electricity costs equivalent to 400 DKK per produced unit. The market demand is characterized by the following function: PD = -200Q +10000 Question A: What is the functional expression for Gert's total revenue (TR), total costs (TC), marginal costs (MC) and marginal revenue (MR)? Question B: What is Gert's optimal price, quantity and profit?

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter16: Government Regulation

Section: Chapter Questions

Problem 10E

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