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Question #69501
There is only one David Garrett, the “David Beckham of Classical Music.” Suppose that Don has obtained the rights to all of Garrett’s recordings, and so he has a monopoly in the market for this music. It turns out that the market demand for Garrett’s CDs is given by P = 120 – 0.2Q, where P is market price and Q is the quantity demanded. Production of these recordings requires paying a fixed cost of $1,000 to rent certain machinery, plus a per-unit payment of$20.

1. What are Don’s profit maximizing output and price?
2. What are Don’s profits, total consumer surplus, and the total deadweight loss at this output and price?

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