A monopolist faces demand P = 200 - 2Q and has constant MC = 40. If the government imposes a price ceiling at the competitive price, the resulting output is:

Question

Accepted Answer

B. Competitive price = MC = 40. Set 200 - 2Q = 40 → 2Q = 160 → Q = 80. Monopoly output without regulation: MR = 200 - 4Q = 40 → Q = 40.

A monopolist faces demand P = 200 - 2Q and has constant MC = 40. If the government imposes a price ceiling at the competitive price, the resulting output is:

解說