What is the monopolist's profit under the following conditions? The profit-maximizing price charged for goods produced is $12. The intersection of the marginal-revenue and marginal-cost curves occurs where output is 10 units and marginal cost is $6. Average total cost for 10 units of output is $5.

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Business

Phillips

2 May, 04:22

What is the monopolist's profit under the following conditions? The profit-maximizing price charged for goods produced is $12. The intersection of the marginal-revenue and marginal-cost curves occurs where output is 10 units and marginal cost is $6. Average total cost for 10 units of output is $5.

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Answers (1)

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Anderson Hunt · Answer 1

monopolist profile is $70

Explanation:

given data

profit-maximizing price = $12

output = 10 units

marginal cost = $6

average total cost = $5

to find out

what is monopolist profile

solution

we know that Profit is express as

profit = Total Revenue - Total Cost ... 1

so here total revenue is

Total Revenue = Price * Quantities

Total Revenue = 12 * 10 = $120

and total cost is

Total Cost = Average cost * Quantities

Total Cost = 5 * 10 = $50

so here from equation 1

profit = $120 - $50

so monopolist profile is $70