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The accompanying graph depicts the marginal revenue (MR), demand (D), and marginal cost (MC) curves for a monopoly. 100 a. Place point P1 at the profit maximizing price and quantity 95 assuming that the monopolist can only charge a single price. 90 85 80 75 b. What are the profits of the firm if it charges a single price? 70 65 60 55 50 45 40 $ 35 30 25 20 15 Suppose the monopolist able to successfully price 10 Price and Costs($)

The accompanying graph depicts the marginal revenue (MR), demand (D), and marginal cost (MC) curves for a monopoly. 100 a. Place point P1 at the profit maximizing price and quantity 95 assuming that the monopolist can only charge a single price. 90 85 80 75 b. What are the profits of the firm if it charges a single price? 70 65 60 55 50 45 40 $ 35 30 25 20 15 Suppose the monopolist able to successfully price 10 Price and Costs($)

Principles of Economics 2e
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 33P: Draw a monopolists demand curve, marginal revenue, and marginal cost curves. Identify the...
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The accompanying graph depicts the marginal revenue (MR), demand (D), and marginal cost (MC) curves for a monopoly. 100 a. Place point P1 at the profit maximizing price and quantity 95 assuming that the monopolist can only charge a single price. 90 85 80 75 70 1 b. What are the profits of the firm if it charges a single price? 65 60 55 50 45 40 35 30 25 MC 20 15 Suppose the monopolist able to successfully price 10 discriminate between two groups by charging one group $70 5 MR and charging $35 to the other group. 05 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95100 Quantity c. What are the firm's profits if it charges the two prices as mentioned above? $ Price and Costs($)
Transcribed Image Text:The accompanying graph depicts the marginal revenue (MR), demand (D), and marginal cost (MC) curves for a monopoly. 100 a. Place point P1 at the profit maximizing price and quantity 95 assuming that the monopolist can only charge a single price. 90 85 80 75 70 1 b. What are the profits of the firm if it charges a single price? 65 60 55 50 45 40 35 30 25 MC 20 15 Suppose the monopolist able to successfully price 10 discriminate between two groups by charging one group $70 5 MR and charging $35 to the other group. 05 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95100 Quantity c. What are the firm's profits if it charges the two prices as mentioned above? $ Price and Costs($)
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