1.7. Suppose a profit-maximizing monopolist is producing 800 units of output and is charging a price of...

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1.7. Suppose a profit-maximizing monopolist is producing 800 units of output and is charging a price of $40 per unit.

a. If the elasticity of demand for the product is -2, find the marginal cost of the last unit produced.

b. What is the firm’s percentage markup of price over marginal cost?

c. Suppose that the average cost of the last unit produced is $15 and the firm’s fixed cost is $2000. Find the firm’s profit.

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Microeconomics

ISBN: 9780132080231

7th Edition

Authors: Robert S. Pindyck, Daniel L. Rubinfeld

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Question Posted: Oct 26, 2024 04:01 AM

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1.7. Suppose a profit-maximizing monopolist is producing 800 units of output and is charging a price of...

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Microeconomics

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