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Earlier we mentioned the special case of a monopoly where MC 2 0. Let's nd the rm's best choice when more goods can be produced
Earlier we mentioned the special case of a monopoly where MC 2 0. Let's nd the rm's best choice when more goods can be produced at no extra cost. Since so much ecommerce is close to this modelwhere the xed cost of inventing the product and satisfying government regulators is the only cost that mattersthe MC = 0 case will be more important in the future than it was in the past. For each demand curve, calculate the prot-maximizing level of output and price as well as the monopolist's prot. Then determine whether the monopoly should or should not go into business. a. P = 100 Q, xed cost = 1,000. Prot-maximizing output Q = Prot-maximizing price P = $ . ' The monopoly go into business. Monopolist's prot: 95
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