Business, 28.11.2019 21:31 ameliaduxha7

Suppose that the supply of the competitive fringe is perfectly elastic atp. there is a dominant firmwith marginal cost per unit ofcwith a capacity constraint ofm, wherep> c. let the demand curvebep= 100−q.(a)suppose that the constraint is not binding. for what values ofcwill the dominant firm be anunconstrained monopolist? (b)suppose that the dominant firm’s unit costs are greater than the maximum value found in (a),but still less thanp, and capacity is not constrained. what is the profit-maximizing price of thedominant firm? (c)suppose thatp= 60 andc= 0. if the dominant firm is not capacity constrained, what is itsoptimal price? (d)suppose thatm= 30,p= 60, andc= 0. will the firm be a price maker? will it earn monopolyprofits? how much is a unit of its capacity worth? (e)does the absolute cost advantage create a barrier to entry in (c)? in (d)?

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