Question firm a is the sole supplier of a certain product

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Question. Firm A is the sole supplier of a certain product. A's marginal cost equals average cost MC = AC = 30, and it faces market demand given by inverse demand function P = 120 0:5Q. Suppose at the moment A produces quantity q = 120 units at price p = 60.

(a) Does rm A maximizes pro t at current price and quantity? Explain.

(b) Is there any dead weight loss at current price and quantity? How much?

(c) What is the monopoly dead weight loss?

Reference no: EM13373333

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