1. Suppose industry demand is given by p = 100 - q, where q is total output in the industry. There are two firms in this industry, firm A has MC of 4 and firm B has MC of 6.1. There are no fixed costs. Calculate firm A's maximum profit, assuming that both firms set price simultaneously and that prices can only be quoted in $s, i.e. no cents.

2.A monopolist who is not engaging in price discrimination of any sort will always equate marginal revenue and marginal cost when maximizing profits.

True

False

3.The imposition of a quantity tax reduces consumer surplus but increases producer surplus.

True

False