1) Apple was effectively a monopolistin the tablet computer market in the spring of 2010. You could gofor the iPad or, well, the iPad. It didn’t even come in a choice ofcolors. Suppose the marginal cost of producing iPads is constant at$200, and the inverse demand curve for iPads is P = 1,000 – 5Q(where Q in millions and P in dollars). The associated marginalrevenue is MR = 1,000 – 10Q.

1. How much should Apple charge, and how many will it sell at thatprice?
2. Compute the consumer surplus and Apple’s producer surplus. (Itis helpful if you draw the demand and MC curves first. Recall thatCS is the area under demand curve and above the price. PS is thearea below the price and above the MC).
3. Now let’s think about how market would look like if Applebehaved like a competitive firm and priced at marginal cost. Howmany iPads will Apple? Compute the new consumer surplus and Apple’sproducer surplus.
4. Compute the value of the “deadweight loss” from monopolization?(Note: One method, use the producer and consumer surplusesyou found in parts (b) and (c). Another method, compute the DWLdirectly by finding the area of the triangle).
5. Draw your results you found in parts (a) – (d) in one P-Qspace.
6. Suppose a government regulatory agency sets a price ceiling of$400 per iPad. How many iPads will Apple sell, and what will be itsproducer surplus?
7. Compute and compare the degrees of monopoly power (LernerIndex) for cases in (a), (c), and (f).
8. Suppose, instead of price ceiling, government imposes a perunit tax of $200. Find the Apple’s price, quantity and producersurplus for iPad.

I have a - e I just need help on f - h