A natural monopolist has the total cost function C(q) = 900 + 25q, where q is its output. The inverse demand function for the monopolist's product is p = 90 - q. Government regulations require this firm to produce a positive amount and to set price equal to average costs. To comply with these requirements (Select all that applies) is impossible for this firm. the firm could produce 5 units. the firm could produce 20 units. the firm could produce 35 units. the firm could produce 45 units. the firm could charge a price of $70. the firm could charge a price of $50. the firm could charge a price of $30.
A natural monopolist has the total cost function C(q) = 900 + 25q, where q is its output. The inverse demand function for the monopolist's product is p = 90 - q. Government regulations require this firm to produce a positive amount and to set price equal to average costs. To comply with these requirements (Select all that applies) is impossible for this firm. the firm could produce 5 units. the firm could produce 20 units. the firm could produce 35 units. the firm could produce 45 units. the firm could charge a price of $70. the firm could charge a price of $50. the firm could charge a price of $30.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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A natural monopolist has the total cost function C(q) = 900 + 25q, where q is its output. The inverse demand function for the monopolist's product is p = 90 - q.
Government regulations require this firm to produce a positive amount and to set price equal to average costs. To comply with these requirements
(Select all that applies)
is impossible for this firm.
the firm could produce 5 units.
the firm could produce 20 units.
the firm could produce 35 units.
the firm could produce 45 units.
the firm could charge a price of $70.
the firm could charge a price of $50.
the firm could charge a price of $30.
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