Microeconomics 2nd Edition by Douglas Bernheim

Exercise 1

As in Worked-Out Problem 17.2 (page 599), Kalamazoo Competition-Free Concrete faces demand function Q d = 16,000 - 200 P. Suppose Kalamazoo's cost function is C ( Q ) = 20 Q + 0.01 Q 2. What is its profit-maximizing sales quantity and price What is the deadweight loss from monopoly pricing
Worked-Out Problem 17.2

Worked-Out Problem 17.1

Figure 17.3 KCC's Demand and Marginal Revenue Curves. KCC's marginal revenue curve lies below the demand curve at all positive quantities. It coincides with the demand curve where it hits the vertical axis (and sales are zero).