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3. [20 points] A Monopolist faces inverse demand curve P=270Q. Suppos.pdf

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3. [20 points] A Monopolist faces inverse demand curve P=270Q. Suppose the marginal cost of production is 0. 3a. [ 8 points] If the monopolist charges a uniform price, what price maximizes its profit? How much profit does it earn (assuming no fixed costs)? 3b. [4 points] Under the optimal uniform price from part (3a), what is the deadweight loss? 3c. [8 points] Suppose that the demand curve above represents the demand of a typical consumer and that the monopolist employs a two-part tariff consisting of a fixed fee F and a price per unit consumed p. What values of F and p maximize the monopolist's profit?.

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3. [20 points] A Monopolist faces inverse demand curve P=270Q. Suppose the marginal cost of production is 0. 3a. [ 8 points] If the monopolist charges a uniform price, what price maximizes its profit? How much profit does it earn (assuming no fixed costs)? 3b. [4 points] Under the optimal uniform price from part (3a), what is the deadweight loss? 3c. [8 points] Suppose that the demand curve above represents the demand of a typical consumer and that the monopolist employs a two-part tariff consisting of a fixed fee F and a price per unit consumed p. What values of F and p maximize the monopolist's profit?

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