Question: Chapter 14: Problems and Applications #5.4, pg. 502.

Use the following graph for a monopoly to answer the questions.

a. What quantity will the monopoly produce, and what price will the monopoly charge?

b. Suppose the monopoly is regulated. If the regulatory agency wants to achieve economic efficiency, what price should it require the monopoly to charge? How much output will the monopoly produce at this price? Will the monopoly make a profit if it charges this price? Briefly explain.