A monopoly's demand curve is P = 200 - 3Q and its MC = $20. How many customers should this company serve? What is the price paid by each customer? What will be the company's gross revenue in this venture?
What will be an ideal response?
If P = 200 - 3Q, then MR = 200 - 6Q.
To find the number of customers serviced, set MC = MR or
20 = 200 - 6Q and now solve for Q.
6Q = 180.
Q = 30 customers.
So P = 200 - 3 (30) = 200 - 90 = $110.
So TR = $110 x 30 = $3,300.
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