(a) Complete the following table that summarizes the weekly sales and cost situation confronting a monopolist. Enter your responses for total revenue, marginal revenue, and marginal cost as whole numbers. Enter your responses for average total cost to two decimal places. Indicate a negative response with a (-) negative sign. Price Quantity Demanded Total Revenue Marginal Revenue Total Cost Marginal Cost Average Total Cost
$22 0 $ --- $ --- $4 $ --- $ ---
$20 1 $ $ $8 $ $
$18 2 $ $ $13 $ $
$16 3 $ $ $19 $ $
$14 4 $ $ $27 $ $
$12 5 $ $ $37 $ $
$10 6 $ $ $51 $ $
$8 7 $ $ $69 $ $
(b) Graph the demand, MR, and MC curves. Draw the demand (D), marginal revenue (MR), and marginal cost (MC) curves. Plot points for each level of output. The demand (D) line should contain 8 reference points and the marginal revenue (MR) and marginal cost (MC) lines should contain 7 reference points each.
(c) At what rate of output is total revenue maximized within this range?
(d) What are the values of MR and MC at the revenue-maximizing rate of output? MR = $ MC = $
(e) At what rate of output are profits maximized? (Choose the highest level.) units
(f) What are the values of MR and MC at the profit-maximizing rate of output? MR = $ MC = $
(g) What are total profits at that output rate?
(h) If a competitive industry confronted the same demand and costs, how much output would it produce in the short run?