Calculate elasticity of demand at profit maximizing price

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A monopolist faces the following demand curve and cost function:

Price = 50 − (1/2)Quantity

Total Cost= 2Quantity + 1000

a. Find the equations for: Marginal Cost, Marginal Revenue, Average Total Cost.

b. Now carefully graph them, along with the demand curve on the same graph.

c. What is the optimal price and quantity if the firm can only set one price for all units?

d. Calculate the elasticity of demand at the profit maximizing price

Reference no: EM131109958

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