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Using time-series data,the demand function for a profit-maximizing monopolist has been estimated as where
is the amount sold,P is price,M is income,and
is the price of a related good.The estimated values for M and
in 2014 are $25,000 and $200,respectively.The short-run marginal cost curve for this firm has been estimated as:
Total fixed cost is forecast to be $500,000 in 2016.The forecasted demand function for 2016 is:
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