Demand Schedule and Total Costs. Can I get some help starting at question 2 and

Question

Demand Schedule and Total Costs. Can I get some help starting at question 2 and the questions following it.

a. If the monopolist maximizes profits, what price does it charge? b. What quantity is produced? c. What are the monopolist's profits? Molly's blooms, the only florist in town, is a monopoly. Molly faces the following demand schedule: 2. Quantity Demanded Total Revenue 0 1 Marginal Revenue Price 12 10 9 4 6 Molly's has the following total costs: Total Cost Marginal Cost Quantity Produced 0 9 12 17 24 34 48 68 2 4 Fill in the empty columns in the tables above. a.

Explanation / Answer

2. a)

b) Molly will produce 3 bouquets. Because at 3 units profit is maximized.

c) Molly will charge $9 per bouquet.

d) TR = P * Q = $9 * 3 = $27

e) TC = $17

f) Profit = TR - TC = $27 - $17 = $10

P($) QD TR($) = P*Q MR($) = ?TR/?Q 12 0 0 11 1 11 11 10 2 20 9 9 3 27 7 8 4 32 5 7 5 35 3 6 6 36 1 5 7 35 -1

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