Suppose you are the mayor of a small town with one cable television company. You are in charge of regulating the price the cable tv company can charge for subscriptions to its services. You know that demand for cable TV and the total costs of the cable company are as follows:

QD = 260 - 16P

TC = 100 + 10Q

1: What is the TV company's marginal cost?

2: Suppose you decide to make the cable provider charge P=ATC. What price do you set?

3: If you make the cable provider charge P=ATC as above, how many subscriptions get sold?

4: If you make the cable provider charge P=ATC as above, what are the firm's profits?