Question

The table below presents the demand schedule and marginal costs facing a monopolist producer.

The table below presents the demand schedule and marginal costs facing a monopolist producer. Q TR ($) MR ($) MC ($) P / ($) 13 0 5 1 12 2 11 10 - 3

Answer 1

Solution:-

Quantity	Price	Total revenue	Marginal Revenue	Marginal Cost
0	13	0
1	12	12	12	5
2	11	22	10	5
3	10	30	8	5
4	9	36	6	5
5	8	40	4	5
6	7	42	2	5
7	6	42	0	5
8	5	40	-2	5
9	4	36	-4	5
10	3	30	-6	5

1) TR = P x Q

2) MR = change in TR/change in Q

B) Profit maximizing level for a monopolist producer is where MR = MC

At this level, Q = 4 units, which is the profit-maximizing output level.

C) Price = 9 per unit