Only one firm produces and sells soccer balls in the country of Wiknam, and as the story begins, international trade in soccer balls is prohibited. The following equations describe the monopolist’s demand, marginal revenue, total cost, and marginal cost: Demand: P = 5 – Q Marginal Revenue: MR = 5 – 2Q Total Cost: TC = 3 + Q + Q2 Marginal Cost: MC = 1 +2 Q where Q is quantity and P is the price measured in Wiknamian dollars. How many soccer balls does the monopolist produce? At what price are they sold? What is the monopolist’s profit.
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Only one firm produces and sells soccer balls in the country of Wiknam, and as the story begins, international trade in soccer balls is prohibited. The following equations describe the monopolist’s demand, marginal revenue, total cost, and marginal cost: Demand: P = 5 – Q Marginal Revenue: MR = 5 – 2Q Total Cost: TC = 3 + Q + Q2 Marginal Cost: MC = 1 +2 Q where Q is quantity and P is the price measured in Wiknamian dollars. How many soccer balls does the monopolist produce? At what price are they sold? What is the monopolist’s profit.
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