b.
c.
d.
e.
14. The diagram below shows a monopolist’s MC and ATC curves as
well as the industry demand and MR curves.
a. What is the profit-maximizing price and level of output
for the monopolist?
b. What area in the figure shows the level of profits for the
monopolist? Are profits positive or negative?
c. What area shows the deadweight loss to society resulting
from the monopolist’s output decision?
d. Now suppose the industry is made up of many small,
price-taking firms (with the same technology). What are
the equilibrium price and level of output in this case?
15. Look back to the diagram of the monopolist on Eagle Island in
Question 12.
p= 18 , Q= 300 , MR= 13 , ATC=5.50, MC=3.50
p= 11 , Q= 680 , MR= 2 , ATC= 6 , MC= 9
p= 15 , Q= 600 , MR= 7 , ATC= 17 , MC= 7
p= 13 , Q= 700 , MR=1.75, ATC=12.50, MC=