Calculate the price elasticity of demand at monopoly price

Assignment Help Business Economics

Reference no: EM131091933

A monopolist with total cost function T C = 30Q + Q^2 is facing a market demand given by P = 150 − Q. a) What is the optimal quantity and price the monopolist will set on this market? (Q=30, P=120) b) What quantity and price would this firm set if it was to behave competitively? (Q=40, P=110) c) Calculate the price elasticity of demand at the monopoly price and quantity point. Does the Lerner price formula hold?

Reference no: EM131091933

Questions Cloud

Using strong arm tactics on software customers : You are a member of an international ethics commission assembled by the World Trade Organization. Your team has been asked to assess the global tactics of Microsoft in recent years. A primary issue is whether Microsoft took unfair advantage of its po..

What interest rate must the investment earn : A mining firm makes annual deposits of $250,000 into a reclamation fund for 25 years. If the firm must have $10 million when the mine is closed, what interest rate must the investment earn? Please include the formulas you used in the form of (A/P, i,..

Write csr objective on sanitarium : There is the company name that you have to write CSR OBJECTIVE - Business Plan Sanitarium - YOU CAN TAKE SOME HELP FROM THAT SLIDE AS WELL

Effective sharing of information with the public : Think about how this relates to the larger topic of developing clinical business intelligence (CBI). in 100 words, contribute ideas/solutions for how your topic can be achieved by public health professionals.

Calculate the price elasticity of demand at monopoly price : A monopolist with total cost function T C = 30Q + Q^2 is facing a market demand given by P = 150 − Q. a) What is the optimal quantity and price the monopolist will set on this market? (Q=30, P=120) b) What quantity and price would this firm set if it..

Unwritten rules of good practice firms : What are the penalties and implications if such roles aren't followed? Are there unwritten rules of good practice firms and bloggers should consider as well? What might those be?

What is the maximal impact on income : Public Affairs 974 Fall 2009 - Problem Set 1. Using the above graph, show what happens if expansionary monetary policy is used (label the curve shift assuming Δ(M/P)). What is the maximal impact on income that can be obtained using monetary policy

Compare the new corporate strategy to the old : Research once failed companies Tyco and Best Buy. In a 2-3 page document, describe in detail, their organizational renewal strategies to create a successful turnaround. Compare the new corporate strategy to the old. Did it work?

Long run equilibrium price if market was competitive : The average total cost of a monopolistic firm is AT C = 80/Q + 20Q. The firm is facing the demand function given by P = 6000 − 20Q. a) What will be the total profit that this firm will generate if it chooses price and quantity optimally?(Profit=22492..

User Account

All Pages