Share With

A monopoly faces a demand function Q(p)=50-p/2. What is the maximal price at which it is able to sell q units?

A. p(q)=100-3q

B. p(q)=50-2q

C. p(q)=50-q

D. p(q)=100-2q

E. p(q)=100-q

pur-new-sol

Since the monopolist is not a price taker, it can sell qq unit of goods at p(q)p(q) from inverse demand function.

Demand function is given as

q(p)=50−p2

Thus, the invert demand function is p(q)=50×2−2q=100−2q

So, the answer is (d).

Related Questions