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(1. Now suppose the government regulates the monopoly by imposing a price ceiling of $60. How many units will be produced? Will every customer who
(1. Now suppose the government regulates the monopoly by imposing a price ceiling of $60. How many units will be produced? Will every customer who is willing to pay the ceiling price of $60 be able to buy the product? Explain why or why not. At $60 per mm, 2150 units can be produced. The demand for the product however is 2500 units. Therefore, there will he a deficit of 350 units of the product in the market. e. Based on the price ceiling of $60, what will be the prot of this monopolist? Contribution = (2150 x $60) (2150 x $40) = $43,000 The monopolist will break even if xed cost = $43,000, make a prot of xed costs $43,000
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