2. The figure below shows demand, marginal revenue, and short-run cost curves for a monopoly: Price and cost (dollars) 30 20 10 0 2,000 MR 4,000 Quantity D a. How much should the firm produce? What price should it charge? b. What is the firm's profit (loss)? c. Should this firm produce or shut down? Explain. d. If the firm shuts down in the short run, how much will it lose? 6,000 SMC ATC AVC

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Monopoly Market

When a company and its products dominate a sector or an industry, it is termed a monopoly. When a firm and its products control a market, then it is called a monopoly.