The inverse demand curve is given byp(y)=10-y and a monopolist
has a fixed supply of 4 units of a good available.
How much will it sell and what price will it set?
What would be the price and output in a competitive
market?
Answer: The monopolist will sell 4 units of the good at a price of 6. In a competitive market, the price would be 10 and the output would be 0.