Question

5. Assume the graph below represents the market for a monopolist. What quantity will the monopolist produce, and what price will she charge? What will her total revenue, costs, and profit be at this level of production? What will the deadweight loss for society be at this level of production? (Assume the MC curve is a straight line between the relevant points for this calculation.) Revenue and costs $34 Demand MR 600 800 940 1160 Quantity

Answer 1

Revenna and tos 34 M C ATC Profit G Tatal ost Deuard NR 600 940 Q peil monehalist wi produce The Guanhly 600 be caune at this paint be in feuaction bw MR and MC there The Pnu haudd be be 34 be cause monafolnt be changed the ophimal Condshon P MR= MC be Pmomofalat Hee For

# Total Rwenue Pn'ce xGUuanhy 34 x600 20400 TR=20400 ATLO of a Pectaugle ABEF Total lost x Byeadth An AF 13 600 7800 TC= $7900 of Rethagle A4-13) x 600 BC DE AY La pefit= BCx BE pofit = 12600 F12600 tngle DEG erhuizb) Ayes #Deadwught las xBane xh (40-600) 3-13) DwL 3570 3570