1.3. Suppose a monopolist mistakenly believes that its marginal revenue is always equal to the market price....

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1.3. Suppose a monopolist mistakenly believes that its marginal revenue is always equal to the market price. Assuming constant marginal cost and no fixed cost, draw a diagram comparing the level of profit, consumer surplus, total surplus, and deadweight loss for this misguided monopolist compared to a smart monopolist.

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Economics

ISBN: 978-0716771586

2nd Edition

Authors: Paul Krugman ,Robin Wells

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