Monopoly-versus-competition comparison

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Consider a monopoly-versus-competition comparison in which market demand is Q = 1,000 - .5P. Assume that production costs differ across structures such that in the competitive structure MCc = ATCc = 500 and in the monopoly structure MCm = ATCm = 200. If the competitive market is converted into a monopoly,

A. what is the change in Consumer Surplus

B. what is the change in Producer Surplus

C. what is the change in Total Surplus

D. which is better, the monopoly or the competitive market (why) ?

Use a figure along with precise numerical answers for A, B, C.

Test is in 4 hours so time is of the essence.

Reference no: EM131631653

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