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Profit maximizing price output and deadweight loss for the monopolist firm.

A monopolist faces the following information:

The market demand: Q = 200 - 2P

The cost structure: TC = 300 + 20 Q

a. Illustrate what is the profit-maximizing price-output combination and what are the levels of profits and consumer surplus at that point?

b. How would your answer to part a. change if the firm is forced into marginal cost pricing?

What is the Dead-weight-loss?

Business Economics, Economics

  • Category:- Business Economics
  • Reference No.:- M916104

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