A monopolist faces the following average revenue
(demand) curve:
P = 100 –
0.01Q
Where Q is weekly
production and P is price, measured in cents per unit. The firm’s
cost function is given by C = 50Q + 30,000. Assume that the firm
maximizes profits.
What is the level of production, price, and total
profit per week?
If the government decides to levy a tax of 10 cents
per unit on this product, what will be the new level...