Question

Provide a graphic analysis that shows the "profit maximizing point" for a firm operating in the monopoly marketplace. Label ALL the parts and explain ALL the parts. Be sure to also show where the equilibrium point is for the monopoly along with any deadweight loss that may be present.  

Answer 1

ANSWER Monoply. Monopoly refer to a market situation in which single seller and large number of buyer. The firm in this marty is paire maker So AR curve is not downward sloptag but quite steep the product produce by the firm is unique. The in barrier to entry of new from in the market. The ins no incforaron available to the Consumer regarding the product in this Market The profit cost equal onquionizing pornt + occurs where (MC=AR occurs where (C=MR) Marginal Revenue and Mc cuts MR from Marginal below. profit Deadweight loss МС дС - Pre Q MR AR output The proft maximizing point at point to where MC = MR and Me celts rce from below at this point the firm oq amount of output and charges op price. At that point the firm super Normal profit given by the Area POST.

The PAR given equilibrum from below by the point in also where MCZ MR cad Mc Cuts at point & the dead weight loss is Area PRE.