a) You are provided with the following demand and cost information for a monopolist.

P=60-0.25 Q and TC=Q²+40Q+50 Where P is price, Q is quantity of the product and TC is total cost. Determine the profit maximizing level of output and prices. (10Marks)

b) The market mechanism is the tendency for prices to change until the quantity demanded equals quantity supplied. Using illustrations provide an explanation on how the market adjusts to the market equilibrium when the price in the market is not originally set at the market equilibrium price.(10Marks)

c) With the help of a well labeled diagram explain the three stages of productions. Why should a firm not operate in the first and third stages? (10 marks)