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Problem 2 It costs a monopolist $4,000 to setup it's production facility and an additional $4 to pro- duce each unit of output Q. The
Problem 2 It costs a monopolist $4,000 to setup it's production facility and an additional $4 to pro- duce each unit of output Q. The demand curve is: Q(P) = 4000 100P where P is the price of the output. (a) Write the inverse demand function. 03) Write the total cost function for producing Q units of output. (c) What is the marginal cost of producing Q? (d) What is the marginal revenue? (e) Find the profit-maximizing quantity and the associated price. (f) Suppose the monopolist is able to determine the willingness to pay of every customer. What quantity of will the monopolist sell now? What will be the profits
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