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    Finding optimal output level

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    Answer the next question on the basis of the following information for a firm operating in an imperfectly competitive market:

    Output------------Price------------Total Cost


    How many units would the above profit-maximizing monopolist produce? Explain

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    Solution Preview

    Please refer attached file for better clarity of table.


    Output Q Price, P Total Revenue Total Cost Marginal Revenue Marginal Cost Profit
    TR=P*Q TC MR* MC** TR-TC
    0 500 0 250 -250
    1 300 ...

    Solution Summary

    Solution describes the steps to find optimal output level and associated profit.