Monopoly question
Sent in by student
A monopolist faces a demand curve 𝑷𝑷 = 𝟗𝟗𝟗𝟗 − 𝟎𝟎, 𝟓𝟓𝟓𝟓, a total cost curve given by 𝑻𝑻𝑻𝑻 =
𝑸𝑸𝟐𝟐 + 𝟏𝟏𝟏𝟏, and the marginal cost curve given by 𝑴𝑴𝑴𝑴 = 𝟐𝟐𝟐𝟐. In the short run, the firm makes
an economic profit of R________ and a markup over the average total cost of R_________.
A.
1520; 47.5
B.
1520; 48
C.
1720; 47.5
D.
1504; 47.5
E.
1504; 48