Suppose that the monopolist from Question 4 is now forced to charge the same price in both markets. Using the demand functions and cost function from Question 4, what is the total inverse demand in this case? What is the profit-maximizing price? What is the monopolist’s profit? (Question 4 = A monopolist is operating in two separate markets. The inverse demand functions for the two markets are P1 = 35 – 2.5Q_1 and P2 = 30 – 2Q_2. The monopolist’s total cost function is TC(Q) = 8 + 5(Q_1 + Q_2). Q_1 means Q subscript 1
Suppose that the monopolist from Question 4 is now forced to charge the same price in both markets. Using the demand functions and cost function from Question 4, what is the total inverse demand in this case? What is the profit-maximizing price? What is the monopolist’s profit? (Question 4 = A monopolist is operating in two separate markets. The inverse demand functions for the two markets are P1 = 35 – 2.5Q_1 and P2 = 30 – 2Q_2. The monopolist’s total cost function is TC(Q) = 8 + 5(Q_1 + Q_2). Q_1 means Q subscript 1
Chapter14: Monopoly
Section: Chapter Questions
Problem 14.5P
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Suppose that the monopolist from Question 4 is now forced to charge the same
profit-maximizing price? What is the monopolist’s profit? (Question 4 = A monopolist is operating in two separate markets. The inverse demand functions for the two markets are P1 = 35 – 2.5Q_1 and P2 = 30 – 2Q_2. The monopolist’s total cost function is TC(Q) = 8 + 5(Q_1 + Q_2). Q_1 means Q subscript 1
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