Gce Model Questions Vol1 2025 Economics Question 18

Practice objective / multiple choice question 18 from the 2025 Gce Model Questions Vol1 Economics examination.

Gce Model Questions Vol1 2025 Economics Objective / Multiple Choice Medium Difficulty
Question 18 GCE_MODEL_QUESTIONS_VOL1 • 2025 • ECONOMICS • objective

The market demand for a good is \(P = 120 - 2Q\) where \(P\) is price (in £) and \(Q\) is quantity. The firm's total cost function is \(TC = 20Q + 0.5Q^{2}\). (a) Determine the profit‑maximising output and price for a monopolist. (b) Calculate the dead‑weight loss compared with perfect competition. Express the dead‑weight loss as a fraction of £.

Answer Options

A. Q=20 units, P=£75, DWL=£900/3 (≈£300)
B. Q=15 units, P=£90, DWL=£600/3 (≈£200)
Correct Answer C. Q=20 units, P=£80, DWL=£800/3 (≈£267)
D. Q=25 units, P=£70, DWL=£1000/3 (≈£333)
Correct Answer
C
Correct Option:
Q=20 units, P=£80, DWL=£800/3 (≈£267)

About This Question

This is Gce Model Questions Vol1 2025 Economics Question 18. It is one of the objective questions from the 2025 Gce Model Questions Vol1 Economics examination.

Difficulty level: Medium .

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