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Bob is a magazine monopolist. His marginal cost of production (per magazine) is constant at $5. His demand information is as follows: Price ($) QD 50 0 40 5 30 10 20 20 15 30 10 50 5 102 2.50 200
a. Calculate the total revenue for Bob at each price.
b. Calculate the (approximate) marginal revenue for Frank at each price.
c. What is Bob's profit-maximising output level and price? Compare this with the perfectly competitive equilibrium level of output and price.
d. (REAL-WORLD APPLICATION) Go to this useful graphics: www.scores.org/graphics/monopoly, and offer YOUR OWN views on the following questions: Is Google a monopoly? Should governments regulate Google? If so, how? (you can use some other online resources to form your views)
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