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A monopolist faces the following information:
The market demand: Q = 200 - 2P
The cost structure: TC = 300 + 20 Q
a. What is the profit-maximizing price-output combination and what are the levels of profits and consumer surplus at that point?
b. How would your answer to part a. change if the firm is forced into marginal cost pricing?
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In using the Taylor Rule as a guideline for monetary policy, what are the pros and cons of using forecasted values of inflation and output rather than observed values of these variables?
Answer the following questions as these general questions pertain to the specific issue selected.The questions that you will cover with respect to your choice of broad social issue in the paper are given.
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