Business, 06.12.2019 21:31, christophercordero15

Suppose you have been tasked with regulating a single monopoly firm that sells 50-pound bags of concrete. the firm has fixed costs of $10 million per year and a variable cost of $6 per bag no matter how many bags are produced.

instructions: enter your answers as whole numbers. in part e, round your answer to 2 decimal places.

a. if this firm kept on increasing its output level, would atc per bag ever increase? .

is this a decreasing-cost industry? .
b. if you wished to regulate this monopoly by charging the socially optimal price, what price would you charge? $ per bag.
at that price, what would be the size of the firm’s profit or loss? at that price, the firm's equals $ million. would the firm want to exit the industry? .
c. you find out that if you set the price at $7 per bag, consumers will demand 10 million bags.
how big will the firm’s profit or loss be at that price? $.
d. if consumers instead demanded 20 million bags at a price of $7 per bag, how big would the firm’s profit or loss be?
at that price, the firm's equals $ million.
e. suppose that demand is perfectly inelastic at 20 million bags, so that consumers demand 20 million bags no matter what the price is.

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Suppose you have been tasked with regulating a single monopoly firm that sells 50-pound bags of conc...