利润最大化

问题如下：

Upsilon Natural Gas, Inc. is a monopoly enjoying very high barriers to entry. Its marginal cost is $40 and its average cost is $70. A recent market study has determined the price elasticity of demand is 1.5. The company will most likely set its price at:

选项：

A.

$40.

B.

$70.

C.

$120.

解释：

C is correct.

Profits are maximized when MR = MC. For a monopoly, MR =P(1-1/|E|) Setting this equal to MC and solving for P:

$40 = P[1 – (1/1.5)] = P × 0.333

P = $120

考题：利润最大化

解析：本题直接考察利润最大化，

直接套用公式，MR =P(1-1/|E|) ，代入数据得：

$40 = P[1 – (1/1.5)] = P × 0.333

P = $120