This post completes a monopolist table
In the following table are demand and cost data for a pure monopolist. Complete the table by filling
in the columns for total revenue, marginal revenue, and marginal cost. Answer these three questions:
(a) What output will the monopolist produce?
(b) What price will the monopolist charge?
(c) What total profit will the monopolist receive at the profit-maximizing level of output?
Total Marginal Total Marginal
Quantity Price revenue revenue cost cost
0 $34 $______ $ 20
1 32 ______ $______ 36 $______
2 30 ______ ______ 46 ______
3 28 ______ ______ 50 ______
4 26 ______ ______ 54 ______
5 24 ______ ______ 56 ______
6 22 ______ ______ 64 ______
7 20 ______ ______ 80 ______
8 18 ______ ______ 100 ______
9 16 ______ ______ 128 ______
10 14 ______ ______ 160 ______
Price discrimination is often used by businesses. Explain the conditions under which price discrimination is practiced and the economic consequences of price discrimination.
Solution Preview
In the following table are demand and cost data for a pure monopolist. Complete the table by filling
in the columns for total revenue, marginal revenue, and marginal cost. Answer these three questions:
(a) What output will the monopolist produce?
(b) What price will the monopolist charge?
(c) What total profit ill the monopolist receive at the profit-maximizing level of output?
Solution:
Complete the table by filling in the columns for total revenue, marginal revenue, and marginal cost.
QUANTITY PRICE TOTAL REVENUE MARGINAL REVENUE TOTAL COST MARGINAL COST
0 $34 0 - $20 -
1 32 32 32 36 16
2 30 ...
Solution Summary
The solution provides all answers to complete the monopolist's table, and includes discussions on monopolist output, monopolist charges, and total profit at profit-maximizing levels of output.