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Given P= 32 - Q, Firm's cost is TC = Q^2 + 24
if government regulates the maximum price monopoly can charge at $23:
1) What is the monopoly’s regulated demand curve? monopoly’s regulated MR curve? Regraph the chart here and mark these curves in different colors.
2) What is monopoly’s regultated output?
3) What is monopoly’s mark-up? Rent? Lerner Index?
4) What is the new deadweight loss? Does it increase or decrease relative to the unregulated monopoly output?
5) At what price level, will deadweight loss be completely eliminated?
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