Suppose a monopolist faces consumer demand given by P=300-5Q with a constant marginal cost of $100 per unit (where marginal cost equals average total cost. assume the firm has no fixed costs). f the monopoly can only charge a single price, then it will earn profits of $ (Enter your response rounded as a whole number.) Correspondingly, consumer surplus is $ However, if the firm were to practice price discrimination such that consumer surplus becomes profit, then, holding output constant at 20, the monopoly would have profits of $
Suppose a monopolist faces consumer demand given by P=300-5Q with a constant marginal cost of $100 per unit (where marginal cost equals average total cost. assume the firm has no fixed costs). f the monopoly can only charge a single price, then it will earn profits of $ (Enter your response rounded as a whole number.) Correspondingly, consumer surplus is $ However, if the firm were to practice price discrimination such that consumer surplus becomes profit, then, holding output constant at 20, the monopoly would have profits of $
Chapter8: Monopoly
Section: Chapter Questions
Problem 15SQ
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