Finding Equilibrium Price and Quantity for monopolist
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The market demand function for a product sold by a monopolist is given below:
QD = 120 - 4P
The monopolist's marginal cost function is given below:
MC = 1.5Q
a) Find MR.
b) Where do demand and MR intersect the quantity axis?
c) Calculate the equilibrium price and quantity.
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Solution Summary
The solution describes the steps for finding Marginal Revenue function, equilibrium quantity and price for a monopolist in a given case.
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a) Find MR.
Let Q be the quantity supplied
Q = 120-4P
P=(120-Q)/4
Revenue = Price* Quantity
=(120-Q)/4*Q = ...
Education
- BEng (Hons) , Birla Institute of Technology and Science, India
- MSc (Hons) , Birla Institute of Technology and Science, India
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