Price($)
Quantity
1000
0
950
1
900
2
850
3
800
4
750
5
700
6
650
7
600
8
550
9
500
10
450
11
400
12
The information in the table above shows a nondiscriminating monopolist’s demand schedule. Assume that MC is $220 and MC = ATC at all output levels. What is the monopolist's economic profit? Please do not input the $ sign in the answer box. If your answer is $200, please input 200 for your answer.
| Price($) | Quantity |
| 1000 | 0 |
| 950 | 1 |
| 900 | 2 |
| 850 | 3 |
| 800 | 4 |
| 750 | 5 |
| 700 | 6 |
| 650 | 7 |
| 600 | 8 |
| 550 | 9 |
| 500 | 10 |
| 450 | 11 |
| 400 | 12 |
The information in the table above shows a nondiscriminating monopolist’s demand schedule. Assume that MC is $220 and MC = ATC at all output levels. What is the monopolist's economic profit? Please do not input the $ sign in the answer box. If your answer is $200, please input 200 for your answer.
Related textbook solutions
Related questions
The table below shows the marginal revenue and costs for a monopolist.
| Demand, Cost and Revenues | ||||
| Price ($) | Quantity demanded | Marginal Revenue ($) | Marginal Cost ($) | Average Total Cost ($) |
| 125 | 200 | 125 | 25 | 139 |
| 118 | 300 | 104 | 32 | 103.3 |
| 111 | 400 | 90 | 40 | 87.5 |
| 104 | 500 | 76 | 50 | 80 |
| 97 | 600 | 62 | 62 | 77 |
| 90 | 700 | 48 | 77 | 77 |
Instructions: Enter your answers as a whole number. If you are entering any negative numbers be sure to include a negative sign (in front of those numbers.)
a. What is the monopolist's profit-maximizing level of output?
b. What is the monopolist's profit at the profit-maximizing level of output?
|
Q |
TC |
TFC |
TVC |
AFC |
AVC |
ATC |
mc |
TR |
MR |
Profit |
Average |
Profit |
|
Profit |
Margin |
|||||||||||
|
0 |
7000 |
7000 |
NIL |
NIL |
NIL |
NIL |
NIL |
0 |
NIL |
-7000 |
NIL |
nil |
|
100 |
14000 |
7000 |
7000 |
70 |
70 |
140 |
70 |
19000 |
190 |
5000 |
50 |
26% |
|
200 |
23000 |
7000 |
16000 |
35 |
80 |
115 |
90 |
38000 |
190 |
15000 |
75 |
39% |
|
300 |
32000 |
7000 |
25000 |
23.33 |
83.33 |
106.67 |
90 |
57000 |
190 |
25000 |
83.33 |
44% |
|
400 |
43000 |
7000 |
36000 |
17.5 |
90 |
107.5 |
110 |
76000 |
190 |
33000 |
82.5 |
43% |
|
500 |
52000 |
7000 |
45000 |
14 |
90 |
104 |
90 |
95000 |
190 |
43000 |
86 |
45% |
|
600 |
74000 |
7000 |
67000 |
11.67 |
111.67 |
123.33 |
220 |
114000 |
190 |
40000 |
66.67 |
35% |
|
700 |
97000 |
7000 |
90000 |
10 |
128.57 |
138.57 |
230 |
133000 |
190 |
36000 |
51.43 |
27% |
|
800 |
111000 |
7000 |
104000 |
8.75 |
130 |
138.75 |
140 |
152000 |
190 |
41000 |
51.25 |
27% |
|
900 |
132000 |
7000 |
125000 |
7.78 |
138.89 |
146.67 |
210 |
171000 |
190 |
39000 |
43.33 |
23% |
|
1000 |
152000 |
7000 |
145000 |
7 |
145 |
152 |
200 |
190000 |
190 |
38000 |
38 |
20% |
(A)What level of output should the manager of Redstone choose to produce? Explain your choice in 50-100 words.
(B) Make a copy of your spreadsheet and triple the fixed costs to 21,000. How does this change your answer to question 3? Explain your result in 50-100 words.
|
Q |
TC |
TFC |
TVC |
AFC |
AVC |
ATC |
mc |
TR |
MR |
Profit |
Average |
Profit |
|
Profit |
Margin |
|||||||||||
|
0 |
7000 |
7000 |
NIL |
NIL |
NIL |
NIL |
NIL |
0 |
NIL |
-7000 |
NIL |
nil |
|
100 |
14000 |
7000 |
7000 |
70 |
70 |
140 |
70 |
19000 |
190 |
5000 |
50 |
26% |
|
200 |
23000 |
7000 |
16000 |
35 |
80 |
115 |
90 |
38000 |
190 |
15000 |
75 |
39% |
|
300 |
32000 |
7000 |
25000 |
23.33 |
83.33 |
106.67 |
90 |
57000 |
190 |
25000 |
83.33 |
44% |
|
400 |
43000 |
7000 |
36000 |
17.5 |
90 |
107.5 |
110 |
76000 |
190 |
33000 |
82.5 |
43% |
|
500 |
52000 |
7000 |
45000 |
14 |
90 |
104 |
90 |
95000 |
190 |
43000 |
86 |
45% |
|
600 |
74000 |
7000 |
67000 |
11.67 |
111.67 |
123.33 |
220 |
114000 |
190 |
40000 |
66.67 |
35% |
|
700 |
97000 |
7000 |
90000 |
10 |
128.57 |
138.57 |
230 |
133000 |
190 |
36000 |
51.43 |
27% |
|
800 |
111000 |
7000 |
104000 |
8.75 |
130 |
138.75 |
140 |
152000 |
190 |
41000 |
51.25 |
27% |
|
900 |
132000 |
7000 |
125000 |
7.78 |
138.89 |
146.67 |
210 |
171000 |
190 |
39000 |
43.33 |
23% |
|
1000 |
152000 |
7000 |
145000 |
7 |
145 |
152 |
200 |
190000 |
190 |
38000 |
38 |
20% |
Suppose that fire pits fall out of fashion and prices fall worldwide to $95. How many units should the manager choose to produce? Explain your answer in 50-100 words.
