Compute total revenue, total cost, and profit at each quantity. itive market, what is the transfer from consumers to producers? What is the deadweight loss? The author is paid $2 million to write the book, and the marginal cost of publishing the book is a constant $10 per book a. Using a new diagram, show the new consumer surplus, producer surplus, and total surplus. ![]() Now suppose that the independent supermarkets combine into one chain. Using a diagram of the market for groceries, show the consumer surplus, producer surplus, and total surplus. A small town is served by many competing supermar- kets, which have the same constant marginal cost. What price would it charge for the book? How much profit would it make at this price? 2. Suppose the publisher was not profit-maximizing but was concerned with maximizing economic efficiency. If the author were paid $3 million instead of $2 million to write the book, how would this affect the publisher's decision regarding what price to charge? Explain. In your graph, shade in the deadweight loss. At what quantity do the margin- al-revenue and marginal-cost curves cross? What does this signify? d. ![]() Graph the marginal-revenue, marginal-cost, and demand curves.
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