Question

Consider a monopolist that faces an inverse demand for its product given by

p=600-4Q

The firm has a cost function C(Q)=9Q^{2}+400

What is the profit-maximizing price for this monopolist? Provide your answer to the nearest cent (0.01)

Answer #1

The inverse demand function is given as:

P = 600 - 4Q

The total revenue function is:

TR = PQ = 600Q - 4Q²

The marginal revenue function is:

MR = d(TR)/dQ = 600 - 8Q

The total cost function is:

TC = 9Q² + 400

The marginal cost function is calculated below:

MC = d(TC)/dQ = 18Q

The monopolist maximizes the profit when marginal revenue is equal to the marginal cost. So,

600 - 8Q = 18Q

26Q = 600

Q = 600/26 = 23.077

Putting Q = 23.077 in the demand function:

P = 600 - 4(23.077)

P = 600 - 92.308

P = 507.692

So, the profit-maximizing price is 507.69.

Consider a monopolist that faces an inverse demand for its
product given by
p=600-9Q
The firm has a cost function C(Q)=3Q2+500
What is the profit-maximizing price for this monopolist? Provide
your answer to the nearest cent (0.01)

A monopolist faces the inverse demand function p = 300 – Q.
Their cost function is c (Q) = 25 + 50Q. Calculate the profit
maximizing price output combination

A monopolist faces the demand for its product: p = a - bQ. The
monopolist has a marginal cost given by c and a fixed cost given by
F. Answer the following questions, while showing all of your
derivation steps. Just providing final answer does not warrant any
mark.
2-a) Assume that F is sufficiently small such that the
monopolist produces a strictly positive level of output. What are
the profit-maximizing price and quantity?
2-b) Compute the maximum profit for...

Example 1:
Suppose a monopolist faces an inverse demand function as p = 94
– 2q. The firm’s total cost function is 1.5q2 + 45q +
100. The firm’s marginal revenue and cost functions are MR(q) = 90
– 4q and MC(q) = 3q + 45.
How many widgets must the firm sell so as to maximize its
profits?
At what price should the firm sell so as to maximize its
profits?
What will be the firm’s total profits?

A monopolist faces an inverse demand curve P(Q)= 115-4Q and
cost curve of C(Q)=Q2-5Q+100.
Calculate industry output, price, consumer surplus, industry
profits, and producer surplus if this firm operated as a
competitive firm and sets price equal to marginal cost.
Calculate the dead weight loss sue to monopoly.

1) The inverse demand curve a monopoly faces
is
p=110−2Q.
The firm's cost curve is
C(Q)=30+6Q.
What is the profit-maximizing solution?
2) The inverse demand curve a monopoly faces
is
p=10Q-1/2
The firm's cost curve is
C(Q)=5Q.
What is the profit-maximizing solution?
3) Suppose that the inverse demand function for
a monopolist's product is
p = 7 - Q/20
Its cost function is
C = 8 + 14Q - 4Q2 + 2Q3/3
Marginal revenue equals marginal cost when output
equals...

Consider a pure monopolist who faces demand Q= 205 - 2P and has
a cost function C(Q) = 2Q.
Solve for the information below, assuming that the monopolist is
maximizing profits.
The monopolist is able to produce at a constant marginal cost of
_________
The monopolist's profit-maximizing level of output is Q* =
______
The monopolist's profit-maximizing price is P* = _________

A monopolist faces the inverse demand for its output:
p = 30 – Q
The monopolist faces a cost curve: C(Q) = 5Q. The government is
seeking ways to collect
tax revenue from the monopolist by imposing an ad valorem tax of
20% on the
monopolist.
1)Draw an approximate graph to depict the before-tax and
after-tax price – quantity
combination (in one graph).

Assume that a monopolist faces a demand curve for its product
given
by:
p=120−1q
Further assume that the firm's cost function
is:
TC=580+11q
Using calculus and formulas (don't just build a table in a
spreadsheet as in the previous lesson) to find a solution, how much
output should the firm produce at the optimal
price?
Round the optimal quantity to the nearest hundredth before
computing the optimal price, which you should then...

A monopolist faces a demand curve given by P=40-Q, while its
marginal cost is given by MC=4+Q. Its profit maximizing output
is
a. 8 b. 9
c. 10 d.
11 e. 12
why is the answer (e)?

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 4 minutes ago

asked 5 minutes ago

asked 12 minutes ago

asked 15 minutes ago

asked 23 minutes ago

asked 24 minutes ago

asked 32 minutes ago

asked 32 minutes ago

asked 32 minutes ago

asked 37 minutes ago

asked 38 minutes ago

asked 47 minutes ago