Can the firm still make a profit

Reference no: EM131072392

In the preceding question, prior to being able to outsource, imagine that the supplier is concerned about entry, and must spend $2,000 in lobbying to maintain her position as a monopolist.

(a) Can the firm still make a profit?

(b) What is the maximum amount the firm could afford to spend on lobbying with the objective of maintaining the monopoly position?

Reference no: EM131072392

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