handout-6 - level of output? If so, what is her profit?...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
Handout 6: Pure Monopoly Heidi's Mineral Springs, a pure monopoly, has the following demand schedule and total cost for bottled mineral water: Quantity (in bottles) Price Total Cost 0 $10 $ 1 1 8 3 2 6 7 3 4 13 4 2 21 5 0 31 a) Calculate Heidi's total revenue and marginal revenue schedules. b) How many bottles of mineral water will Heidi sell? At what price? Will she earn an economic profit at this
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: level of output? If so, what is her profit? Draw graphs using the total as well as marginal approaches to confirm your answer. c) If the fixed costs increased by $5, how would this affect Heidi's output decision? Explain carefully. If the fixed costs increased by $10, how would this affect Heidi's output decision? Explain....
View Full Document

This note was uploaded on 10/26/2009 for the course ECON 180-004-20 taught by Professor Bresnock during the Fall '09 term at UCLA.

Ask a homework question - tutors are online