A monopoly faces an inverse demand curve py 100nbsp-nbsp2y


A monopoly faces an inverse demand curve, p(y) = 100 - 2y, and has constant marginal costs of 20.

(a) What is its profit-maximizing level of output? __________

(b) What is its profit-maximizing price? __________

(c) What is the socially optimal price of this firm? __________

(d) What is the socially optimal output of this firm? __________

(e) What is the deadweight loss due to the monopolistic behavior of this firm? __________

(f) Suppose this monopolist could operate as a perfectly discriminating monopolist and sell each unit of output at the highest price it would fetch. The deadweight loss in this case would be __________

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Business Economics: A monopoly faces an inverse demand curve py 100nbsp-nbsp2y
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