Suppose a CEO is considering acting as a monopolist, where she could earn 4,662,376 in profits, however, if caught, she will spend time in prison and have to pay an additional 269,182 in court fees. If the CEO values her freedom at 1,188,914 and there's a 10% chance she'll be caught, what is her expected profit from acting as a monopolist. Round your answer to the nearest whole numbe

Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter9: Monopoly
Section: Chapter Questions
Problem 6SCQ: Imagine a monopolist could charge a different price to every customer based on how much he or she...
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Suppose a CEO is considering acting as a monopolist, where she could earn 4,662,376 in profits, however, if caught, she will spend time in prison and have to pay an additional 269,182 in court fees. If the CEO values her freedom at 1,188,914 and there's a 10% chance she'll be caught, what is her expected profit from acting as a monopolist. Round your answer to the nearest whole number.

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