Based on the best available econometric estimates, the market elasticity of demand for your firm's product is -2

Given:

Elasticity of demand (e) is -2

Marginal cost (MC) is $150

Average Total Cost (ATC) is $225

_a_

You are a monopolist.

For a monopolist the profit maximizing level of output is set at the point where the marginal revenue (MR) is equal to the marginal cost (MC) of production. That is,

MR=MC

Now, the relationship between marginal revenue/marginal cost, price and elasticity in monopoly is given as:

Calculating for price,

Therefore, the optimal per unit price for monopolist is $300

_b_

You compete against one other firm in Courtnot oligopoly.

Number of firms (N) =2,

Using Lerner's rule for 2 firms,

We have,

Thus, the optimal per unit price in two firms Cournot model is $200.

_c_

You compete against nineteen other firm in Courtnot oligopoly.

Number of firms (N) =20

Applying Lerner's rule for N firms,

We get,

Thus, the optimal per unit price for additional nineteen firms in Cournot oligopoly is $153.846