FILL THE BLANK.
A monopoly firm has the following demand and cost conditions:
DEMAND: P = 100 – 0.5q
TOTAL COST: TC = 1000 + 10q + q2
MARGINAL COST: MC = 10 + 2q
a. Find the output level q* which maximizes profit ______________
b. Calculate the monopolist’s profit (or loss) at q* _______________
c. What is the monopolist’s Total Fixed Cost? __________________
d. Should the firm shutdown or continue to produce at the output level q*?
e. Why or Why not? Explain.