Explain why this outcome is inefficient in comparison to the competitive omom. 2. A nospillet for a market demand curve gives by Q-70-P The monopolet's marginal vse function is given by MR-70-20 An 4 If the sonopolist can peodice at constant asg and marginal costs of AC MC-6, what output level will the monopolist choose in order to maximise pendin? What is the price at this put level? What are the monopolist's profit? Au intend that the monopolist has a structure where total costs are described by TC-0250-50+300 and marginal cost is given by MC 050-5 With the monopolet facing the same market demand and marginal revenue, what price-quantity contation will be chosen se to maximise profite? What will profits be? A now that a third coet structure explain the monopolat's position, with total costs g TO-BQ²-Q²+Q+ 100 MC-0000-20+ price-quity ination that matinio profits. What will al and the qudratie forma or simple factoring and marginal at gives by Agais, olate the wond profits be? (Hats MCMIL ve the expation Q.) 4. Graph the market de curve, the Mil car, and the three marginal cost cure butts parts. part 1 and part . Setien that the monopoliat's prot-making ability in matenby (1) market demand curve it face (along with its acted MR e), and (2) the struct NOR P R FL % 5 V H T G 6 B Y H & 7 N U .00 8 J NO M ( 9 K DO O V I of O L comma 4. Consider a Cournot duopoly with the inverse demand P = 200-2Q. Firms 1 and 2 compete by simultaneously choosing their quantities. Both firms have constant marginal and average cost MC = AC = 20. a. Find each firm's best response function. b. Find the Cournot-Nash equilibrium quantities, profits and market price. c. Plot the best response functions (label the axes q1 and 92) and illustrate the equilibrium point.. d. Suppose that instead of choosing their quantities simultaneously, firm 1 chooses first and firm 2 follows, find the Stackelberg equilibrium quantities, profits and market price. e. Returning to the case in which the firms choose simultaneously, suppose that for firm 1, MC = AC 20 but for firm 2, MC 10. How would this affect your answers to part h?
