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Suppose a profit-maximizing monopolist is producing 800

Suppose a profit-maximizing monopolist is producing 800 units of output and is charging a price of $40 per\ unit.

a. If the elasticity of demand for the product is -2, find the marginal cost Of the last unit produced.

b. What is the firm"s percentage markup of price over marginal cost?

c. Suppose that the average cost of the last unit produced is $15 and the firm"s fixed cost is $2000.Find the firm"s profit.

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Solution Preview :

Prepared by a verified Expert

Microeconomics: Suppose a profit-maximizing monopolist is producing 800

Reference No:- TGS0660364

Have a Question? (oR Write a Review)

Recent Questions Asked Microeconomics

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Solution Preview :

Prepared by a verified Expert

Microeconomics: Suppose a profit-maximizing monopolist is producing 800

Reference No:- TGS0660364

Recent Questions Asked Microeconomics

Q : Why will a monopolists output increase if the government

Q : Why is there a social cost to monopsony power if the gains

Q : Will an increase in the demand for a monopolists product

Q : Where q is weekly production and p is price measured in

Q : Suppose a profit-maximizing monopolist is producing 800

Q : On a diagram draw the marginal cost curves for the two

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