Question
Assume that the government imposes a tax on a monopolist, which has been in the market for long time. Suppose further that the tax forces
Assume that the government imposes a tax on a monopolist, which has been in the market for long time. Suppose further that the tax forces the monopolist to face the conditions shown in the table below.
What are the profits of the monopolist following the tax? Explain your answer.
| Output | Price | Total Cost |
| 0 | 54 | 18 |
| 1 | 48 | 54 |
| 2 | 42 | 84 |
| 3 | 36 | 108 |
| 4 | 30 | 126 |
| 5 | 24 | 150 |
| 6 | 18 | 180 |
| 7 | 12 | 216 |
| 8 | 6 | 258 |
| 9 | 0 | 306 |
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Economics
Authors: John Sloman, Jon Guest, Dean Garratt
10th edition
1292187859, 9781292187907 , 978-1292187853
