1. Suppose that a monopolist has the following TC curve: TC=1/2*Q² and market demand is given by P=15-0.33Q.
2. Calculate the monopolist's profit max Q and P.
3. Show these on a graph.
4. What is the monopolist's profit?
5. What would the price and quantity be in perfect competition?

1. If firm I has an elasticity of demand of -2 and firm II has an elasticity of demand of -3.
2. Which will these two firms with market power will have a higher price markup? Show this on a graph.
3. What is the Lerner Index for the two firms?

1. Suppose a company faces decreasing average cost for all quantities of Q. What type of industry is this? Draw a graph.

1. Suppose a monopolistically competitive firm faces the following demand curve: P=50-Q and TC=10Q.
2. What price and Q will the firm choose?
3. What are profits?
4. Draw a graph that shows the long run equilibrium of the monopolistically competitive firm.