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

question 5

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. How much profit does the monopolist earn?

• A) $4050
• B) $4950
• C) $450
• D) $5

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