Question

- A monopoly firm having following cost and revenue curves for the prices of 0,10,20,30,40,45,0

MC = 1 + 2Q

AC=10+ 6 / Q

Q = 100 - 2P

MR= 50-Q

Graph all the curves on the same axis and find the optimal level of output and prices. Calculate the profit or loss of the firm.

Answer #1

Consider Amazon AWS as the only known company providing cloud
computing service in the world. The demand for cloud computing
service is given by P = 100 − Q, and the marginal revenue in this
monopoly market is MR = 100 − 2Q. The marginal cost of providing
this service is MC = 5Q. There are no fixed costs and ATC=3Q. Show
your work on all parts.
a. Find the monopoly output and price set by Amazon AWS.
b. Calculate...

. A town has a monopoly supplier of potable water. The
monopolist faces the following demand, marginal revenue, and
marginal cost curves:
Demand: P = 70 – Q
Marginal Revenue: MR = 70 – 2Q
Marginal Cost: MC = 10 + Q
Graph these curves.
Assuming that the firm maximizes profit, what quantity does it
produce? What price does it charge? Show these results on your
graph.
The local government decides to impose a price ceiling that is
10 percent...

Suppose a monopoly firm has the following Cost and Demand
functions:
TC=Q2
P=20-Q
MC=2Q
MR=20-2Q
Carefully explain what the firm is doing and why.
Find the firm’s Profit maximizing Q
Find the firm’s Profit maximizing P.
Find the firm’s Profit.
2. Suppose because of an advertising campaign, which costs $150,
the monopoly’s demand curve is: P=32-Q so its MR= 32-2Q
Looking closely at the TC function and the demand curve,
explain the effects of the advertising campaign on the equations...

(a) Suppose the total revenue (TR) and total cost (TC) curves of
the perfectly competitive firm are given by the following set of
equations: TR = 100Q and TC = Q2 + 4Q + 5, where Q is
the output. Derive the firm’s profit maximizing output and
calculate the total and average profit earned by the firm at this
level of output.
(b) How do you know that the equations above could not be
referring to a monopoly?

Use the following information for a monopoly firm to answer
the following four questions. Assume that Q equals the level of
output and that costs include economic costs.
Total Revenue = 550*Q - 0.5*(Q squared)
Marginal Revenue = 450 - Q
Total cost = 2,000 + 50*Q + 0.5*(Q squared)
Marginal cost = 50 + Q
A) Calculate
the level of Output this monopoly will produce at the profit
maximizing level of output.
B) Calculate the Price this monopolist will...

A monopoly faces the following inverse demand function:
p(q)=100-2q, the marginal cost is $10 per unit.
What is the profit maximizing level of output, q*
What is the profit maximizing price
what is the socially optimal price
What is the socially optimal level of output?
What is the deadweight loss due to monopoly's profit maximizing
price?

Cost, revenue, and profit are in dollars and x is the number of
units. A firm knows that its marginal cost for a product is MC = 3x
+ 30, that its marginal revenue is MR = 70 − 5x, and that the cost
of production of 60 units is $7,380. (a) Find the optimal level of
production. units (b) Find the profit function. P(x) = (c) Find the
profit or loss at the optimal level. There is a of...

26. The marginal cost for a product is: MC = 3X +20; its;
marginal revenue is
MR
= 44 - 5x. The cost of production of 80 units is 11,400.
Find the optimal level of production X.
Find the Profit Function.
Find the Profit or Loss at the optimal level x.

if the marginal cost of a firm is MC = 9q^2 + 2q +1 and the
marginal revenue MR = 60-q. Given that total cost is 3390 when q
-10
(a) Derive an expression for total cost
(b) Derive the expression for total revenue
(c) Using the results from (a) and (b) find the total profit
function

A monopoly has the following demand and total cost
curves:
Demand: P=500-5Q
Costs: TC=200Q+10Q^2
You also know its marginal cost and marginal revenue
curves:
MC=200+20Q
MR=500-10Q
What is the Deadweight Loss for Monopoly? What is Consumer
Surplus? (Hint: it would help to draw a graph for this question, as
you did in the Extra Credit)
Select one:
a. DWL=$100; CS=$250
b. DWL=$50; CS=$250
c. DWL=$100; CS=$150
d. DWL=$50; CS=$150

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