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A monopolist has an inverse demand curve given by p(y) = 12-y and a cost curve given by c(y) = y 2 . What will
A monopolist has an inverse demand curve given by p(y) = 12-y and a cost curve given by c(y) = y2.
- What will be its profit maximizing level of output? ________
- Suppose the government decides to put a tax on this monopolist so that for each unit it sells it has to pay the government $2. What will be its output under this form of taxation? ________
- Suppose now that the government puts a lump sum tax of $10 on the profits of the monopolist. What will be its output? __________
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