Suppose that the inverse demand function for a monopolists product is p = 9 - Q/20. Its
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Suppose that the inverse demand function for a monopolist’s product is p = 9 - Q/20. Its cost function is C = 10 + 10Q - 4Q2 + 2/3 Q3. Draw marginal revenue and marginal cost curves. At what outputs does marginal revenue equal marginal cost? What is the profit-maximizing output? Check the second-order condition, d2π/dQ2, at the monopoly optimum.
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Microeconomics Theory and Applications with Calculus
ISBN: 978-0133019933
3rd edition
Authors: Jeffrey M. Perloff
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