Limits to the Monopoly Power

Limits to the - monopolist cannot choose both Price and Output to be sold He has to determine one of these quantities If he chooses higher price P

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Limits to the Monopoly Power: Though a monopolist has complete freedom in determining his own price, there are some limits to his power. These are listed below: i) The demand curve of a monopolist slopes downwards . This is shown as demand curve DD of the monopolist in Figure 38. On such a curve, a
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Unformatted text preview: monopolist cannot choose both Price and Output to be sold. He has to determine one of these quantities. If he chooses higher price P 1 he has to be satisfied with smaller sales of quantity Q 1 . If he prefers larger output Q 2 he will have to charge lower price P 2 . ....
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This note was uploaded on 11/26/2011 for the course ECONOMIC ec 201 taught by Professor - during the Fall '10 term at Montgomery.

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