(Table: Demand for Economics Tutoring) Look at the Table Demand

question 108

Essay

(Table: Demand for Economics Tutoring) Look at the table Demand for Economics Tutoring.Suppose Eric is the only economics tutor in town and therefore holds a monopoly on the sale of economics tutoring.The table shows the demand schedule for his services.Eric can offer additional hours of tutoring at a constant marginal cost of $2 per hour, and he has no fixed costs.a) If Eric acts as a monopolist, how many hours will he offer and what price will he charge?
b) Calculate Eric's monopoly profit.

---

Definitions:

Consumer Preference

The inclination of consumers toward certain products or services over others based on their characteristics, such as taste, quality, and price.

Equilibrium

An equilibrium in the market where demand matches supply, thereby stabilizing prices.

General Equilibrium

An economic condition where supply and demand are balanced across all markets in the economy, leading to an optimal distribution of resources.

Simultaneous Equilibrium

A condition in which all markets in an economy are in equilibrium at the same time, reflecting a balance between supply and demand.