Question

Suppose that the local hardware store has a monopoly on screwdrivers. The market demand is given...

Suppose that the local hardware store has a monopoly on screwdrivers. The market demand is given by P = 33 – 0.25Q and the marginal revenue is MR = 33 – 0.5Q. The marginal cost of selling screwdrivers is MC = 1 + 1.5Q. What is the profit-maximizing price the monopolist should charge for the screwdrivers and how many will they sell?

Price: $

Quantity: screwdrivers

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Answer #1

IN Monopay the profit Maximization is at - MC = Mar 33-0.50 = It 150 20 = 32 ANSWER (0) 40=16 Screwdrivers and P = 33-0.250 3

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