d) What are the price and quantity if you a have fixed costs of 490? What is the profit? e) Consider the case that the developer of the App wants to maximize the overall welfare and not just his profit. Determine price and quantity. What is the profit? Show CS and PS. f) Draw the welfare losses of the Monopoly, which occur opposite to perfect competition. Calculate the net welfare losses.

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
icon
Related questions
Question

part D E F 

i need in words 

not handwritten or pic

5(Chapter 11 Monopoly)
The inverse demand for an app is
P = PD (Q) = 30 - 0,4. Q.
The inverse demand function indicated the price P, were the quantity Q will be sold. The app is sold
just from the app developer. The programing of the app creats fixed costs of 420. The marginal costs
are 2.
a) Draw the demand curve
b) Calculate the marginal revenue and the average cost function. Draw the marginal revenue
and marginal cost function in the diagram of a).
c) Determine the profit maximizing quantity and price. What are the average costs? What is the
profit? Draw the average cost curve and the profit in the diagram. Show the consumer
surplus (CS) and producer surplus (PS).
d)
What are the price and quantity if you a have fixed costs of 490? What is the profit?
e) Consider the case that the developer of the App wants to maximize the overall welfare and
not just his profit. Determine price and quantity. What is the profit? Show CS and PS.
f) Draw the welfare losses of the Monopoly, which occur opposite to perfect competition.
Calculate the net welfare losses.
Transcribed Image Text:5(Chapter 11 Monopoly) The inverse demand for an app is P = PD (Q) = 30 - 0,4. Q. The inverse demand function indicated the price P, were the quantity Q will be sold. The app is sold just from the app developer. The programing of the app creats fixed costs of 420. The marginal costs are 2. a) Draw the demand curve b) Calculate the marginal revenue and the average cost function. Draw the marginal revenue and marginal cost function in the diagram of a). c) Determine the profit maximizing quantity and price. What are the average costs? What is the profit? Draw the average cost curve and the profit in the diagram. Show the consumer surplus (CS) and producer surplus (PS). d) What are the price and quantity if you a have fixed costs of 490? What is the profit? e) Consider the case that the developer of the App wants to maximize the overall welfare and not just his profit. Determine price and quantity. What is the profit? Show CS and PS. f) Draw the welfare losses of the Monopoly, which occur opposite to perfect competition. Calculate the net welfare losses.
Expert Solution
steps

Step by step

Solved in 4 steps with 2 images

Blurred answer
Knowledge Booster
Financial Statements
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
Economics
ISBN:
9780190931919
Author:
NEWNAN
Publisher:
Oxford University Press
Principles of Economics (12th Edition)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education