Change in output and price per unit as a result of subsidy

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A profit-maximizing monopolist named Edd faces a demand function given by q = 1000 - 20p, where p is the price of his output in dollars. He has a constant marginal cost of 20 dollars per unit of output. In an effort to induce Edd to increase his output, the government agrees to pay him a subsidy of $10 for every unit produced. What is the change in output and price per unit as a result of the subsidy?

Reference no: EM13838145

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