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Based on the above graph, answer the following questions for a monopoly and a perfectly competitive firm. A. For the monopolist: i. Profit maximizing output = ii. ATC = iii. AR = iv. Price = v. Total Revenue = vi. Total Cost = vii. Profit = GE273: Week 8 Monopoly versus Perfect Competition Page 2 B. For the perfectly competitive firm: i. Profit maximizing output = ii. ATC = iii. AR = iv. Price = v. Total Revenue = Formulas and calculations must be shown along with the final correct answer. vi. Total Cost = vii. Profit = C. Discuss the differences you observe in your answers above between the monopoly and perfectly competitive firm.

Explanation / Answer

i.profit maximizing output where MR=MC so Q=20 for monopolist ii.ATC=18 iii.AR=total revenue/quantity=30 iv.price=30 v.total revenue=P*Q=30*20=600 vi.total cost=ATC*Q=18*20=360 vii.profit=600-360=240

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