Scenario 10.2: A Monopolist Faces the Following Demand Curve, Marginal Revenue Curve

question 135

Multiple Choice

Scenario 10.2:
A monopolist faces the following demand curve, marginal revenue curve, total cost curve and marginal cost curve for its product:
Q = 200 - 2P
MR = 100 - Q
TC = 5Q
MC = 5
-Refer to Scenario 10.2. Suppose that a tax of $5 for each unit produced is imposed by state government. What is the profit maximizing price?

• A) $90.00
• B) $10.00
• C) $55.00
• D) $52.50

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