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Unformatted text preview: the profit made by the monopolist. Illustrate your answer on a diagram. (b) An inventor now offers to sell to the firm, for a fee of 400, a technique that will reduce marginal cost to 6 per unit. Will the firm choose to buy the new technique? Would it be in the interest of society as a whole (excluding the inventor) for the firm to purchase the technique? Key terms to revise and understand: Marginal Revenue and Average Revenue Super-normal profit Natural monopoly Types of price discrimination Regulation...
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This note was uploaded on 03/15/2012 for the course EC 111 taught by Professor Timhatton during the Spring '12 term at Uni. Essex.
- Spring '12