The market demand curve for a commodity and the total cost for a monopoly firm producing the commodity is given by the schedules below. Use the information to calculate the following:


Quantity



0



1



2



3



4



5



6



7



8



Price



52



44



37



31



26



22



19



16



13



Quantity



0



1



2



3



4



5



6



7



8



Price



10



60



90



100



102



105



109



115



123



(a) The MR and MC schedules


(b) The quantites for which the MR and MC are equal


(c) The equilibrium quantity of output and the equilibrium price of the commodity


(d) The total revenue, total cost and total profit in equilibrium.

(a) The MR and MC schedules


Quantity



Price



TR



MR



TC



MC



0



52



0



-



10



-



1



44



44



44



60



50



2



37



74



30



90



40



3



31



93



19



100



10



4



26



104



11



102



2



5



22



110



6



105



3



6



19



114



4



109



4



7



16



112



-2



115



6



8



13



104



-8



123



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(b) The quantites for which the MR and MC are equal


MR =MC = 6 units of Quantity, where both MR and MC is Rs 4


(c) The equilibrium quantity of output and the equilibrium price of the commodity


Equilibrium Price = Rs 19; Equilibrium Quantity = 6


(d) The total revenue, total cost and total profit in equilibrium.


TR = Rs 114; TC = Rs 109; Profit = Rs 5 (TR – TC)


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