Demand) P = 250 - 5Q
(Marginal Revenue) MR = 250 - 10Q
Let’s assume further that this firm s...
Mathematics, 24.11.2021 06:00 pettismayersjoy3le8
Demand) P = 250 - 5Q
(Marginal Revenue) MR = 250 - 10Q
Let’s assume further that this firm sells all of its widgets at the same price. Although you don’t have the MC and AC curves, if you take the demand and marginal revenue curves as given, the greatest quantity of output that the firm would ever want to sell if the firm sold every unit at the same price and behaved as a price-taking firm (i. e. if the firm behaved as though it was actually a perfectly competitive market) would be ? units.
b. Now assume that the firm will behave as a traditional price-setting monopoly firm. Approaching this as you did above in part a, if the firm sets the same price for every unit, then the greatest quantity of output this same firm would ever want to sell as a price-setting monopoly firm is ? units.
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