Marginal costs for production and distribution are stable at$5per unit. Calculate output, price and profits at profit-maximizing level. What record price and profit levels would prevail following expiration of copyright protection based on the assumption that perfectly competitive pricing would result?
To maximize the monopoly profit, the firm use first order condition, i.e.
15-0.00001Q = 5
then 0.00001Q = 10
solve for Q*=10/0.00001= ...
The expert determines monopoly versus perfectly competitive equilibrium.