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3. Profit maximization and loss minimization Lagatt Green is a monopoly beer producer and distributor operating in the hypothetical economy of Lightington. Assume that Lagatt

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3. Profit maximization and loss minimization Lagatt Green is a monopoly beer producer and distributor operating in the hypothetical economy of Lightington. Assume that Lagatt Green is not able price discriminate, and so it sells its beer to all customers at the same price per bottle. The following graph gives the marginal cost (MC), marginal revenue (MR), average total cost (ATC), and demand (D) curves that Lagatt Green faces for beer in Lightington. Place the black point (plus symbol) on the graph to indicate the profit-maximang price and quantity for Lagatt Green. If Lagatt Green is making a profit, use the green rectangle (triangle symbols) to shade in the area representing its profit. On the other hand, if Lagatt Green is suffinmg a hoss, use the purple rectangle (diamond symbols) to shade in the area representing its loss. Suppose tagatt Green Charges $2.50 per bottle, Your study partner Gabriel says that becausen tagatt Green is a monopoly with market powey, it should charge the higher trice of $3.00 per botte in order to shcrease its profit. Grven the earher information, Gabriel correct in his assertion that Lagatt Green should charge $3,00 per bottle. Suppose that a technological innovation decreases Lagatt Green's costs so that it now faces the marginal cost (MC) and average total cost (ATC) given on the following graph. Specifically, the technological innovation causes a decrease in average foxed costs, thereby lowering the ArC curve and moving the MC curve. Place the black point (plus symbol) on the following graph to indicate the profit-mawimizing price and quantity for lagatt Green. If Lagatt Green is making a profit, use the green rectangle (trangle symbols) to shade in the area representing its protit. On the other hand, if Lavatf Green is suffering) a loss, use the purple rectangle (diamond symbols) to shade in the area representing the lass. Place the black point (plus symbol) on the following graph to indicate the profit-maximizing price and quantity for Lagart Green. If Lagart Groen is making a profit, use the green rectangle (triangle symbols) to shade in the area representing its profit. On the other hand, if Lagatt Green is sulfermy a loss, use the purple rectangle (dfamond symbols) to shade in the area representing the loss

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