use graph to answer questions 1-2

Regulating Monopoly Suppose you are an analyst for a board that regulates local monopolies. Your supervisor has given you the three questions below. Using the information in Figure 37.1, answer your supervisor's questions. Figure 37.1 Regulating a Monopoly $5,00 MC m 3.00 COSTS/REVENUE ATC 2.00 1.00 MR 1,000 2.000 3,000 4,000 5,000 QUANTITY 1. If this monopolist is not regulated, what will be the level of (A) output? (B) price? (C) total revenue? (D) total costs? (E) profit or loss? 2. If this monopolist is regulated by marginal cost pricing (i.e., the socially optimal price), what will be the level of (A) output? (B) price? (C) total revenue? (D) total costs? (E) profit or loss? (F) Will the monopoly need a subsidy? (G) If so, how much