Question 2 (Monopolies) 3) There is a monopolist of widgets that has the cost function of: C= 100- 5Q + Q2 This creates a marginal cost of: MC = 2Q- 5 Demand is given by the function: P = 55-2Q Given the above function the Marginal revenue is given by: MR=55-4Q A) What price should the monopolist set to maximize prot? B) What output level will maximize prot for the monopolist? C) What is the maximum prot the monopolist earns? D) What is the amount of consumer surplus when the monopolist maximizes prot? E) Now suppose that the industry becomes a PERFECTLY COMPETITIVE industry, where P = MC. F) What is the prot maximizing price and quantity now in the perfectly competitive industry