How To Calculate Maximum Profit In A Monopoly

A monopolist, having total control over the level of output it produces and the price it charges, will generally be interested in maximizing its profits. But what if a firm decides that it is revenues that should be maximized instead? This lesson will examine the profit maximization rule as it applies to a pure monopolist, and introduce the revenue maximization rule, which tells a monopolistFor a pure nondiscriminating monopolist, marginal revenue is less than price because. answer choices An important economic problem associated with pure monopoly is that, at the profit-maximizing outputs, resources are. answer choices . overallocated because price exceeds marginal cost.39. A nondiscriminating profit-maximizing monopolist: A. will never produce in the output range where marginal revenue is positive. B. will never produce in the output range where demand is inelastic. C. will never produce in the output range where demand is elastic. D. may produce where demand is either elastic or inelastic, depending on the level of production costs. 10-8PQd $10 ON AWN The above table shows the demand schedule facing a nondiscriminating monopoly firm. Assume that this monopolist faces zero production costs. The profit- maximizing monopolist will set a price of $__. Please do not input the $ sign.Refer to the above data for a nondiscriminating monopolist. At its profit-maximizing output, this firm's price will exceed its marginal cost by ____ and its average total cost by ___. answer choices

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A profit-maximizing monopolist that produces in the short run will a. produce the level of output where marginal revenue exceeds marginal cost by the largest amount b. increase output as long as the marginal revenue exceeds the marginal cost of producing that unit c. produce the level of output where average total cost is at a minimum d.Question 10. 10. The nondiscriminating pure monopolist must decrease price on all units of a product sold in order to sell more units. This explains why. there are barriers to entry in pure monopoly. a monopoly has a perfectly elastic demand curve. marginal revenue is less than average revenue.A discriminating monopoly is a single entity that charges different prices—typically, those that are not associated with the cost to provide the product or service—for its products or services for...A monopolist can use information on marginal revenue and marginal cost to seek out the profit-maximizing combination of quantity and price. Table 2 expands Table 1 using the figures on total costs and total revenues from the HealthPill example to calculate marginal revenue and marginal cost.

A nondiscriminating profit maximizing monopolist A will

A nondiscriminating monopolist earning positive short-run economic profit determines that its current marginal cost is $15 and its current marginal revenue is $20. To maximize profit, a firm should raise price and increase output raise price and decrease outputoutput for a nondiscriminating monopolist. Use the same diagram to show the equilibrium position of a monopolist that is able to practice perfect price discrimination. Compare equilibrium outputs, total revenues, economic profits, and consumer prices in the two cases. Comment on the economic desirability of price discrimination.60. Refer to the above diagram for a nondiscriminating monopolist. At output Q production will be unprofitable. True False 61. Refer to the above diagram for a nondiscriminating monopolist. The profit-maximizing price for this firm is J. True False 62. Refer to the above diagram for a nondiscriminating monopolist. At output M total variableThe monopolist solves the typical problem of setting the price (in conjunction with volume of production) so as to maximize total profit collected from both markets. For whatever reason (legal, technological, marketing, etc.), she is nondiscriminating, which means she sets the unified price for both markets.For example, if the price of a good is $10 and a monopolist sells 100 units of a product per day, its total revenue is $1,000. The marginal revenue of producing 101 units per day is $10. With 101

A nondiscriminating profit-maximizing monopolist:

1.might produce where demand is both elastic or inelastic, relying at the degree of production costs.

2. will never produce in the output vary where marginal earnings is certain.

3. won't ever produce within the output vary where demand is inelastic.

4. won't ever produce within the output range where call for is elastic.