The marginal cost of production is $4, and assume there is no fixed cost. The farmer is the only seller in the market so it will be a monopoly seller. Suppose the demand for the apple is p=32-2q. 1. What is the monopolist's optimal price 2. At this price, what is the buyer surplus? What is the seller surplus?

Survey Of Economics
10th Edition
ISBN:9781337111522
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter8: Monopoly
Section: Chapter Questions
Problem 10SQP
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The marginal cost of production is $4, and assume there is no fixed cost. The farmer is the only seller in the market so it will be a monopoly seller. Suppose the demand for the apple is p=32-2q.

1. What is the monopolist's optimal price

2. At this price, what is the buyer surplus? What is the seller surplus? 

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