Identical demand for a product

Identical demand for a product

Macroeconomics
1. All 500 consumers in a market have identical demand for a product that is described by individual demand curves P=40-2q. A monopolist produces the product and has a cost function of TC(Q)=10000+8Q. What is the monopolist’s maximum profit if it cannot price discriminate or use a two-part tariff?

(Answers must be within 1 of the true value to count as correct.)

2. All 500 consumers in a market have identical demand for a product that is described by individual demand curves P=40-2q. A monopolist produces the product and has a cost function of TC(Q)=10000+8Q. What is the use fee in the two-part tariff the maximizes profits?

(Answers must be within 1 of the true value to count as correct.)

3. All 500 consumers in a market have identical demand for a product that is described by individual demand curves P=40-2q. A monopolist produces the product and has a cost function of TC(Q)=10000+8Q. What is the entry fee in the two-part tariff the maximizes profits?

4. All 500 consumers in a market have identical demand for a product that is described by individual demand curves P=40-2q. A monopolist produces the product and has a cost function of TC(Q)=10000+8Q. What is the monopolist’s maximum profit if it uses a two-part tariff?

(Answers must be within 1 of the true value to count as correct.)

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