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The inverse demand for a product is given by P = 400 - 5 Q , where Q measures the number of units and P
The inverse demand for a product is given by P = 400 - 5Q, where Q measures the number of units and P is the price per unit. Suppose that the marginal cost per unit is $100 + 5Q. Graph demand, marginal revenue, and marginal cost. Calculated the consumer, producer, and total surplus at the perfectly competitive price and quantity. Calculate the same at the profit-maximizing (i.e. monopolist) price and quantity, and compare the two.
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