2. A. To sell more what must a monopolist do?

4. If there is only one producer of a service due to a natural monopoly, how do societies ensure that the natural monopolist does not earn large monopoly profits?

1.800 Marginal cost 1.600 1.400 Total profit 1200 Average cost 1 000 Marginal Cost Marginal Revenue 80O 600 Demand QuantityStep 2: Look at demand curve to see what price to charge Marginal cost R Average P cost Price ($) S P, b Step 3: Identify profit -Step1: MR = MC Demand Marginal revenue Q. QuantityBOO Marginal cost 400 Marginal revenue Maximum Total Cost/Total Revenue (S 1,000 possible profit 800 600 400 200 200 Quantity Cost Information Revenue Information Total Marginal Average Total Marginal Quantity Cost Cost Cost Quantity Price Revenue Revenue 1,500 1,500 1,200 1,200 1,800 300 900 1,100 2,200 1,000 2,200 400 733 1,000 3,000 800 2,700 500 675 900 3,600 500 3,300 600 560 800 4,000 400 4,200 900 700 700 4,200 200 5,400 1,200 77 600 4,200 7,200 1,800 900 8 500 4,000 -200