Posted by **Em** on Thursday, October 17, 2013 at 2:09pm.

Suppose the demand curve for a monopolist is

QD = 500 − P, and the marginal revenue function

is MR = 500 − 2Q. The monopolist has a constant

marginal and average total cost of $50 per unit.

a.Find the monopolist’s profit-maximizing output

and price.

b. Calculate the monopolist’s profit.

c. What is the Lerner Index for this industry?

- economics -
**Hasnain**, Monday, December 14, 2015 at 2:28pm
I am not sure about the answer but I think that for profit maximizing output . MR = MC , therefore 500-2Q=50 ( MC = 50 per unit ) , after calculating , we get the output of 275 and the price of 225. The profit is 48,125.

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