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For questions 3 and 4 assume the service, instead of being provided by the Ministry, is provided by a monopolist. The monopolists knows the true
For questions 3 and 4 assume the service, instead of being provided by the Ministry, is provided by a monopolist. The monopolists knows the true marginal cost of the service, $1. For the demand P = 10 - Q, the marginal revenue of is given by MR = 10 - 2Q.
Assuming many firms engage in wasteful competition to be appointed as the monopoly provider of this service, what is the deadweight loss caused by rent-seeking behaviour? dont answer by pen paper
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