1. The demand curve faced by a monopoly firm is given by the function P = 57000 - 5.7Q. What is the absolute value of theslope of its marginal revenue curve?

Note: the absolute value refers to the value of a number after ignoring its sign. For example, the absolute value of -100 is 100.

2. The demand curve faced by a monopoly firm is given by P = 500 - 2Q.

• The marginal cost of production for the firm is constant and equal to $18.

At what price will the firm maximize its profits?

3. Consider a firm with monopoly power with a constant marginal cost of production equal to $10 and a linear (straight, downward-sloping) demand curve.

• Its profit-maximizing price and quantity are $200 and 200 respectively.
• The surplus-maximizing quantity of the good is equal to 400.

What is the deadweight loss associated with the monopoly's profit-maximizing output?

Do not enter the $ sign. Round to two decimal places if required.

4. Suppose that you develop a vaccine for a transmissible disease. You incurred large fixed costs of research and development. Your marginal cost of producing a dose of the vaccine (now that it is developed) is constant at $25 per dose.

Which of the following is true?

a.

You will earn positive economic profits if you charge a price equal to $25.

b.

You will earn negative economic profits if you charge a price equal to $25.

c.

You will earn zero economic profits if you charge a price equal to $25.

d.

Your economic profits could be negative or positive if you charge a price equal to $25.