Suppose the market demand faced by a monopoly can be represented by

   P = 32 - Q

Firm’s cost is TC = Q2 + 24

1)   What is the MR curve?

2)   What is the firm’s MC curve? Graph the firm’s MR, MC and Demand curve.

3)   Firm’s profit-maximizing output Qm?

4)   Firm’s price Pm? Markup? Rent? Mark the area of Monoply Rent in your graph.

5)   ATC at Qm? Plot the ATC curve in your graph in part 2).

6)   Monopoly’s profit at Qm? Mark the area of Monopoly Profit in your graph.