A. using graph, explain the pricing decision of a monopolist and the deadweight loss of monopoly. B....

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A. using graph, explain the pricing decision of a monopolist and the deadweight loss of monopoly. B. QantasLink is the only service provider between Sydney and toowoombas Brisbane West Wellcamp Airport. Explain why it is unlikely for Qantadlink to charge prices much higher than the competitive level on this monopoly route. Are there other routes within Australia on which a monopoly would likely result in much higher prices?

Robert · Accepted Answer

The monopolist produces a quantity such that MR=MC. 
The price is determined by the demand curve at the quantity. 
A monopoly make a profit equal to revenue minus total cost 
When total output is less than socially optimal there is a dead-weight loss.
From the above figure:

A. using graph, explain the pricing decision of a monopolist and the deadweight loss of monopoly. B. QantasLink is the only service provider between Sydney and toowoombas Brisbane West Wellcamp...

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