Virat Cement is a monopolist in the cement industry. Its cost is C = 100 - 5Q + Q ^ 2 and demand is P = 55 -2Q. (MC is the supply function).   A. What price should Virat Cement set to maximize profit?   B. What output does the firm produce and determine its profits?   C. What would output and price be if the firm acted like a perfect competitor and set MC = P?

Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter24: Price-searcher Markets With High Entry Barriers
Section: Chapter Questions
Problem 15CQ
icon
Related questions
Question

Virat Cement is a monopolist in the cement industry. Its cost is C = 100 - 5Q + Q ^ 2 and demand is P = 55 -2Q. (MC is the supply function).

 

A. What price should Virat Cement set to maximize profit?

 

B. What output does the firm produce and determine its profits?

 

C. What would output and price be if the firm acted like a perfect competitor and set MC = P?

Expert Solution
steps

Step by step

Solved in 4 steps

Blurred answer
Knowledge Booster
Profit Maximization
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Recommended textbooks for you
Economics: Private and Public Choice (MindTap Cou…
Economics: Private and Public Choice (MindTap Cou…
Economics
ISBN:
9781305506725
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
Microeconomics: Private and Public Choice (MindTa…
Microeconomics: Private and Public Choice (MindTa…
Economics
ISBN:
9781305506893
Author:
James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:
Cengage Learning
Micro Economics For Today
Micro Economics For Today
Economics
ISBN:
9781337613064
Author:
Tucker, Irvin B.
Publisher:
Cengage,
Economics For Today
Economics For Today
Economics
ISBN:
9781337613040
Author:
Tucker
Publisher:
Cengage Learning
Survey Of Economics
Survey Of Economics
Economics
ISBN:
9781337111522
Author:
Tucker, Irvin B.
Publisher:
Cengage,
Economics:
Economics:
Economics
ISBN:
9781285859460
Author:
BOYES, William
Publisher:
Cengage Learning