Online Economics Managerial class using Michael Baye's 5th edition book.
You are the manager of a monopoly, and your demand and cost functions are given by
P = 200 - 2Q and C(Q) = 2,000 + 3Q2, respectively.
a. What price-quantity combination maximizes your firm's profits?
b. Calculate the maximum profits.
c. Is demand elastic, inelastic, or unit elastic at the profit-maximizing price-quantity combination?
d. What price-quantity combination maximizes revenue?
e. Calculate the maximum revenues.
f. Is demand elastic, inelastic, or unit elastic at the revenue-maximizing price-quantity combination?
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Monopoly/Oligopoly problems are solved.