Question

The demand for the goods offered by a monopolist can be
determined by the inverse demand function ?(?) = 8 - 2/3 q, where ?
describes the offered is quantity. The cost function of the
monopolist is:

?(?) = 1/3q^{2} + 2q + 1

a) Please calculate the profit-maximizing production quantity
?^{M}, the profit-maximizing prize ?^{M} and the
corresponding profit ?^{M}

of the monopolist.

b) Now please display this situation graphically and then determine
the Consumer and producer surplus from this situation.

c) Calculate the learner index in the monopoly solution and show
that in the "Inverse Elasticity Rule" applies to this monopoly
solution.

(d) Please explain what happens to the price if the general Demand
elasticity increased.

Answer #1

A monopoly is facing inverse demand given by P = 40−0.5Q and
marginal cost given by MC = 7+0.1Q. Illustrate these on the graph
and answer the questions below.
(a) If the monopolist is unable to price discriminate, what is
the profit-maximizing quantity? What is the price? What is consumer
surplus? Producer surplus? Deadweight loss?
(b) Suppose instead the monopolist is able to perfectly price
discriminate. How many units will be sold? What is consumer
surplus? Producer surplus? Deadweight loss?

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)

6. Curse Purge Plus is a monopolist in the curse removal market
They face an inverse demand curve given by P=200-4Q, where Q is the
number of curse removals they sell. Their cost function is
C(Q)=10+8Q.
a. Write down the company’s profit function
b. Find the first-order condition for profit maximization.
c. Find the profit-maximizing price and quantity, and the
maximum profit.
d. Calculate the consumer surplus in the market at the monopoly
price and quantity.
e. If price were...

Consider a monopolist facing a market demand given by:
P = 100 – 2Q
Where P is the price and Q is quantity. The monopolist produces
the good according to the cost function c(Q) = Q2 +
10.
Determine the profit-maximizing quantity and price the
monopolist will offer in the market
Calculate the profits for the monopolist
Calculate the deadweight loss due to a monopoly. Illustrate
this in a well labeled diagram.

Monopoly
Consider a situation where a monopolist faces the following
inverse market demand curve
p = 132 − 2q
and the following cost function
T C = 12q + 2q 2
f) How much deadweight loss does the monopolist create?
g) What could the government do to regulate the monopolist?

A monopolist faces inverse demand p = 40 − 2q and has a marginal
cost of 20.
(a) [20 points] What output will the monopolist produce?
(b) [10 points] What are consumer surplus, monopoly profits, and
deadweight loss?
(c) [10 points] Suppose the monopolist’s costs rise to 90. What
are consumer surplus, monopoly profits, and deadweight loss
now?
Please help to explain part (c).

(i) A monopolist has the following total cost function:
C=50+10Q+0.5Q2
They face the market demand of: P= 210-2Q
a. What is the profit maximizing price and quantity set by
this monopoly? What is the monopolist's profit?
b. Calculate the producer surplus, consumer surplus, and
deadweight loss.
c. If the price elasticity of demand faced by this
monopolist at the equilibrium is -1.625, what is the Lerner
Index?
d. If the price elasticity of demand faced by this
monopolist at the...

1. Suppose a monopolist faces an inverse demand function of P =
150 ? 2Q. The firm’s cost functions is 30Q.
(a) What is the firm’s marginal cost? Average cost? How about
the firm’s marginal revenue?
(b) What would the firm charge if they were a single price
monopolist?
(c) What is the consumer surplus, producer surplus, and dead
weight loss.
(d) Suppose the monopolist is able to perfectly price
descriminate, what are the consumer surplus, producer surplus, and
dead...

Consider a monopolist facing a market demand given by
P = 100 - 2Q
where P Is the price and Q is the quantity. The monopolist
produces the good according to the cost function
c(Q)=Q2+10
(a) Determine the profit maximizing quantity and price the
monopolist will offer in the market
(b) Calculate the profits for the monopolist.
(c) Calculate the deadweight loss due to a monopoly. Illustrate
this In a well labelled diagram.

Consider a monopolist facing a market demand given by
p=100-2q
Where p is the price and q is the quantity, the monopolist produces
good according to the cost function c(q)=q^2 +10
A determine the profit-maximizing quantity and the price the
monopolist will offer in the market
B calculate the profits for the monopolist
C calculate the deadweight loss due to a monopoly. Illustrate
this in a well-labelled diagram.

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