DEX0 Enterprises, a monopoly, faces the following demand curve. DEX is owned by three sisters, Alice, Mary and Claire. At this time the firm faces a constant MC and ATC of $4.00 per unit of their product.
|
Price
|
Quantity Demanded
|
Total Revenue
|
Marginal Revenue
|
|
10
|
0
|
|
|
|
8
|
1
|
|
|
|
6
|
3
|
|
|
|
4
|
6
|
|
|
|
2
|
10
|
|
|
|
0
|
15
|
1. Complete the table by calculating Total Revenue and Marginal Revenue for this firm.
2. Alice is would like to see DEX's product used by as many people as possible. Which price would she choose? How many units would DEX need to produce and distribute if Alice was in charge?
3. Mary wants to maximize total revenue. What price would she choose? How many units would DEX sell?
4. Claire wants to maximize profits. What price would she choose? How many units would DEX sell?