monop - Problems on Monopoly Behavior Here are some...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Problems on Monopoly Behavior Here are some problems on monopoly behavior. Answering Problems 1-4 will be easier if you have worked the homework problem on pages 205-209 of the text. 1. A monopolist faces a demand function that can be described by the equation P=505-15Q where P is the price that the monopolist charges per unit of output and Q is the number of units that the monopolist can sell at that price. The monopolist's total costs are 25Q and its marginal cost is 25. The following expression expresses the monopolist's profit as a function of the number of units sold: (a) 505-15Q-25 (b) 505-30Q (c) 480Q-15Q^2 (d) 505Q-15Q^2-15 (e) None of the above (Note Q^2 means Q-squared.) (Hint: Profit is Total Revenue Minus Total Cost) 2. The monopolist found in the previous problem has a marginal revenue curve that is described by the equation (where MR stands for marginal revenue): (a) MR=505-15Q (b) MR=505-25Q (c) MR=520+25Q (d) MR=505-30Q (e) MR=530-40Q 3. Where quantity is measured on the horizontal axis and dollars on
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 12/25/2011 for the course ECON 1 taught by Professor Bergstrom during the Fall '07 term at UCSB.

Page1 / 2

monop - Problems on Monopoly Behavior Here are some...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online