The demand function P for maximising a profit monopolist is given by P=274-x², while the marginal cost is 4+3x for x units of commodity. The consumer surplus is
The demand function P for maximising a profit monopolist is given by P=274-x², while the marginal cost is 4+3x for x units of commodity. The consumer surplus is
Solution
✅ Correct Option: 4
The demand function is and the marginal cost is .
A monopolist maximizes profit where Marginal Revenue equals Marginal Cost.
Total Revenue is:
Marginal Revenue is the derivative of Total Revenue:
Setting :
Taking the positive value:
The price at :
Consumer Surplus is the area between the demand curve and the price level:
Evaluating the integral:
Applying limits from 0 to 9:
Therefore:
The consumer surplus is .
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