Question

#13 please

References and Further Reading a. If the marginal cost of an additional spect profit-maximizing price? b. If the stadium seating capacity is 80,000, wh: 13. Suppose that the demand is given by P= a-bQ, marginal revenue is MR = a - 2bQ, and marginal cost is equal to zero. a. What are the competitive price and output? b. What is the consumer surplus? c. What are the monopoly price and output? d. What is the monopoly profit? e. What is the consumer surplus? 14. In section 4.3, Ticket Pricing, treat quantity as th show that the results are precisely the same. 15. Return to section 6, and look at the valuations pla no discrimir

Answer 1

Ans13 Following information P-a-bQ - is given - ③ MR = a-2bQ ME=0 - ③ I a) In competitive market, equilibrium is whem MR = MC. a-zbQ=0 a=2bQ 12b Putting it in equation 6. Pea- ( 2 ) P= a- ą

& Prics Whena=o. P= a-bQ PO whin p:o, P = a-bQ o=a.bQ MG=0 a/b Buty Consumer surplus is the area betwan MC and demand wine. cs = 1 x base) x (height) 5)*(a)

e) Under monopaly, the equilibrium condition is - MR = MC (profit manimisation) a-2.bQ=0 (a Also, J. P = 9/L. d) As AC is not given, it is assumed that Alzo. Profit - TR - TO : PXB, - Асх = a(P-AC)