Martin Monopolist faces the following demand function: Q = 24,000 — 8P. Martin has the following...

Question

Martin Monopolist faces the following demand function: Q = 24,000 — 8P. Martin has the following cost function: TC = 4,500,000 + 150Q.
9. Calculate the profit maximizing price and quantity. 10. Calculate the maximum profits of the firm. 11. Graph the demand, marginal revenue, marginal cost and average cost functions for the firm. 12. Shade in the area that represents the profits of the firm. 13. Now assume that the firm is regulated so that price = average cost. What price and quantity does this correspond to? 14. What is the deadweight loss from monopoly if the firm is left unregulated? 15. What is the deadweight loss from monopoly if the firm is regulated so that price = average cost?

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Robert · Accepted Answer

Q19
equate dd with ss
14000-5P= -1300 +10P
15300=15P
P= 1020
Q= 8900
Q20
put Q= 8000 in supply curve to get P= [8000+1300]/10 =930
Put Q in ddd curve to get P=[14000-8000]/5 =1200
so tax=1200-930 =270  
Q9
equate Mc with Mr
MC= 150
 P = 3000 -.125Q
MR= 3000-.25Q
3000-.

Martin Monopolist faces the following demand function: Q = 24,000 — 8P. Martin has the following cost function: TC = 4,500,000 + 150Q. 9. Calculate the profit maximizing price and quantity. 10....

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