Suppose Monolith Enterprises has gained exclusive rights to sell ball point pens in St. Catharines. The demand for ball point pens is described by Q = 1500 - 10P, Monolith can produce any number of ball point pens at a constant marginal cost of $2 per pen (i.e., MC(Q) = 2).
1. Write down the monopolist's optimization problem in which the monopolist chooses quantities.
2. What quantity of pins should Monolith produce? 3. What is the price at this level of output?