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In: Economics

Suppose that the inverse demand function, marginal revenue, marginal cost and total cost for a gizmo...

Suppose that the inverse demand function, marginal revenue, marginal cost and total cost for a gizmo product produced by a monopolist are as follows:

P = 100 - 2Q

MR = 100 - 4Q

MC = 2

TC = 10 + 2Q

a. Find the monopolist's profit-maximizing output and price.

b. calculate the monopolist's profit/losses, if any.

c. What is the Lerner Index for this industry.

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Expert Solution

Rahul Sunny answered 2 years ago
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