1.A firm has the following total costs, where Q is output and TC is total cost:

Q TC

0 $ 100

1 110

2 130

3 160

4 200

5 250

6 310

7 380

8 460

9 550

10 650

11 760

Since the profit maximizer will produce a quantity such that MC = P = 80, it will produce units

a.How much profit is the firm making at a price of $80? Based on this calculation, do you expect firms to enter or leave this market?

b.Say instead this firm is a monopoly. If the firm maximizes profit at an output level where marginal revenue equals $ 50, what output level will this be?