Assume the only costs to the firm are marginal costs (so MC-ATC in this case) and that thefirm/s cannot price discriminate.Price, cost,marginalrevenue ofdiamond$1,000800600400200MC-200-400MR8 101620Quantity of diamonds(See Figure 3) At the profit maximizing quantity for the monopolist, total revenue istotal cost is and profit isO $4800, $3200, $1600O $1600, $3200, $1600O $600, $200, $400O $4800, $1600, $3200

Monopoly maximizes profit by producing at a point where marginal revenue is equal to marginal cost…

Assume the only costs to the firm are marginal costs (so MC-ATC in this case) and that the firm/s cannot price discriminate. Price, cost, marginal revenue of diamond $1,000 800 600 400 200 MC -200 MR 8 10 -400 16 20 Quantity of diamonds (See Figure 3) At the profit maximizing quantity for the monopolist, total revenue is total cost is and profit is O $4800, $3200, $1600 O $1600, $3200, $1600 O $600, $200, $400 O $4800, $1600, $3200

Assume the only costs to the firm are marginal costs (so MC-ATC in this case) and that the firm/s cannot price discriminate. Price, cost, marginal revenue of diamond $1,000 800 600 400 200 MC -200 MR 8 10 -400 16 20 Quantity of diamonds (See Figure 3) At the profit maximizing quantity for the monopolist, total revenue is total cost is and profit is O $4800, $3200, $1600 O $1600, $3200, $1600 O $600, $200, $400 O $4800, $1600, $3200

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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