Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

The following table shows the demand for a product produced by a monopolist, who has a constant marginal cost and an average total cost of

The following table shows the demand for a product produced by a monopolist, who has a constant marginal cost and an average total cost of $45 per unit.

Quantity (thousands of units)

Price (dollars per unit)

0

120

1

105

2

90

3

75

4

60

5

45

6

30

a. Calculate the total revenue and marginal revenue for level of quantity.

b. What are the profit-maximizing level of output and the price of the product?In no more three sentences, explain why.

c. Calculate the monopolist's profit.

d. Calculate the Lerner Index for this industry.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Business Law Text and Cases

Authors: Kenneth W. Clarkson, Roger LeRoy Miller, Gaylord A. Jentz, F

11th Edition

324655223, 978-0324655223

Students also viewed these Economics questions