Economics- Monopoly

Part 1

Part a

PriceQuantityTotal RevenueMarginal RevenueTotal CostProfit
24                                          10,000.00           240,000.00
      50,000.00                190,000.00
22                                          20,000.00           440,000.00                200,000.00    100,000.00                340,000.00
20                                          30,000.00           600,000.00                160,000.00    150,000.00                450,000.00
18                                          40,000.00           720,000.00                120,000.00    200,000.00                520,000.00
16                                          50,000.00           800,000.00                   80,000.00    250,000.00                550,000.00
14                                          60,000.00           840,000.00                   40,000.00    300,000.00                540,000.00

Part b

Profits are maximized at the quantity of 50000 and the price of $16. Profitability at this point will be 550,000.

Part 2

MR=MC

1000-20Q = 100 + 10Q

30Q= 1000-100

Q = 900/30= 30

For price,

P= 1,000 – 10Q

=1000-  10*30 = 700

1,000 –10Q = 100+10Q

               20Q=  900

                Q=  900/20

                Q= 45

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