Purchase Solution

Monopoly and Competition Problem

Not what you're looking for?

Ask Custom Question

The optimum market quantitiy in a competitive market if:
P=100-.5q
MR = 100-q
Ac= 10$ per unit

Is this the way you calculate it? If not, how do you do it?

Profit =MC=MR

10 = 100-q
90 = q

How do you then calculate the quantity brought to market by a monopolist?

Purchase this Solution

Solution Preview

The usual equilibrium of MR=MC is equally applicable to the monopolist. Here, MR = MC = AC.
Therefore, 100 - q = 10
or q = 100 - 10 = 90
At this point the monopolist produces and supplies output quantity q = 90. This is the only profit-maximizing condition for ...

Purchase this Solution


Free BrainMass Quizzes
Elementary Microeconomics

This quiz reviews the basic concept of supply and demand analysis.

Pricing Strategies

Discussion about various pricing techniques of profit-seeking firms.

Economics, Basic Concepts, Demand-Supply-Equilibrium

The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.

Basics of Economics

Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.

Economic Issues and Concepts

This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.