DD is a monopolist firm. Its cost is C=100-5Q+Q2 and demand is P=55-2Q. What price should...

DD is a monopolist firm. Its cost is C=100-5Q+Q2 and demand is P=55-2Q.

What price should DD set to maximize profit and what output does the firm produce? How much is the profit?
What would be output if DD acted like a perfect competitor and set MC=P ? What is the profit?
What is the deadweight loss from monopoly power in (a). Show graphically

Suppose the government, concerned about the high price of DD, sets a maximum price for DD’s product at k27. How does this affect price, quantity, consumer surplus and DD’s profit? What is the resulting deadweight loss? (5 marks

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Rahul Sunny answered 1 year ago

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