Details of this Paper

ECO - Suppose that a monopolistic seller of designer handbags

Description

solution


Question

Question;suppose that a monopolistic seller of designer handbags faces the following inverse demand curve: P = 50 - 0.4Q. The seller can produce handbags for a constant marginal and average total cost of $10.A) Calculate the profit - maximizing price for this seller.B) Suppose the government levies a $4 tax per unit on sellers of handbags.Calculate how this tax will affect the price the monopolist charges its customersC) Who bears the burden of this tax?

 

Paper#57563 | Written in 18-Jul-2015

Price : $22
SiteLock