Question
The market demand function for shield in the competitive market is Q = 2 0 0 , 0 0 0 1 , 0 0 0
The market demand function for shield in the competitive market isQ=200,0001,000p
Each shield requires 2 units of Vibanum (V) and 1 unit of labor (L). The wage rate is constant at $40 per unit. Suppose all Vibanums are produced by a monopolist with constant marginal costs of $20 per Vibanum.
- What price,, does the monopolist charge for the Vibanum ?
- What price would it charge for shield if it vertically integrated into the shield market?
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Principles Of Economics
Authors: Robert H. Frank, Ben Bernanke Professor, Kate Antonovics, Ori Heffetz
6th Edition
0078021855, 9780078021855
