Question

Help solve problems from picture #2 (continuation of picture #1)

A monopolist can produce at a constant average (and marginal) cost of It faces a market demand curve of Q.71-P Calculate the profit-maximizing price and quantity for this monopolist. Also calculate its profits The monopoly would produce 33 units of output at a price of $ 38 (Enter numeric responses using real numbers rounded to two decimal places,) In turn, the monopoly would eam profit of $ 1089 Suppose a second firm enters the market. Let Q, be the output of the first firm and Q be the output of the second. Market demand is now given by Q1+Q2-71-P. Assuming that this second firm has the same costs as the first, write the profits of each firm as a function of Q1 and Q2 The profit functions for Firm 1 (11,) and for Firm 2 (I12) are OA. I1, PxQ1-50 and I12 PxQ2-502 OD. 11, 171-(a,+2)-50, and I12 171-(2)-502

Answer 1

We can write demand as

P = 65-Q

TR = Q×P

=65Q - Q^2

MR = dTR\dQ = 65 - 2Q

Fro quantity MC = MR

65 - 2Q = 5

Q = 30

P - 65 - 65 - 30

P = 35

Monopoly will produced Q = 30 and price is P = $35