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Questions › JNU › JNU SIS 2017 › Q48
2 marks, −1Microeconomics › Monopoly and price discrimination › Monopoly equilibrium and marginal revenueEasyabout 1 min

JNU SIS 2017 Question 48: Monopoly and price discrimination

A monopolist faces a demand curve given by D(q)=100−2pD(q) = 100 - 2pD(q)=100−2p. Its cost is c(y)=2yc(y) = 2yc(y)=2y. What is its optimal level of output q∗q^*q∗ and price p∗p^*p∗?

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A monopolist faces a demand curve given by D(q) = 100 - 2p. Its cost is c(y) = 2y. What is its optimal level of output q* and price p*? (A) q* = 20 and p* = 10 (B) q* = 45 and p* = 20 (C) q* = 48 and p* = 26 (D) None of the above

Monopoly and price discrimination has come up 128 times in 7 exams since 2004.

What this question tests

This question is on Monopoly equilibrium and marginal revenue, part of Monopoly and price discrimination in Microeconomics.

How a monopolist sets price and output where marginal revenue equals marginal cost.

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Question from the JNU SIS 2017 paper. Solutions are TestStop's own. Not affiliated with or endorsed by any examination authority.