Suppose a perfectly discriminating monopolist faces market demand: P = 100 – 10Q and marginal cost: MC = 20. 4. How much output does the perfectly discriminating monopolist produce? a. Q = 20 b. Q = 4 c. Q = 8 d. Q = 10 e. Q = 12 5. How much profit does the perfectly discriminating monopolist earn (assume that fixed cost = 0)? a. Profit = $0 b. Profit = $160 c. Profit = $20 d. Profit = $640 e. Profit = $320

Lusk corporation produces and sells 14,300 units of product x each month. the selling price of product x is $25 per unit, and variable expenses are $19 per unit. a study has been made concerning whether product x should be discontinued. the study shows that $72,000 of the $102,000 in monthly fixed expenses charged to product x would not be avoidable even if the product was discontinued. if product x is discontinued, the annual financial advantage (disadvantage) for the company of eliminating this product should be: