:

1) Legal and regulatory barriers: These include government regulations, licensing requirements,
patents, copyrights, and other forms of intellectual property protection. These barriers can make it
difficult for new firms to enter the market and compete with existing monopolies.

2) Economies of scale: Monopolies often arise when a single firm can produce goods or services at
a lower cost than multiple firms. This can be due to economies of scale, where the cost per unit
decreases as the volume of production increases. Existing monopolies may have already reached a
large scale of production, making it difficult for new firms to match their efficiency and compete
effectively.

3) Control over essential resources or inputs: Some monopolies are able to maintain their market
power due to their exclusive control over essential resources or inputs. For example, if a company
has exclusive access to a key raw material or distribution network necessary for production, it can
create significant barriers for potential competitors.

4) Network effects: Network effects occur when the value or utility of a product or service increases
as more people use it. This can create a natural monopoly where the dominant firm already has a
large user base, making it difficult for new entrants to attract customers away. Examples of network
effects include social media platforms, operating systems, and online marketplaces.

A) To find the short-run equilibrium output and price levels, we need to set the monopolist's marginal
cost equal to its marginal revenue.

First, let's calculate the monopolist's marginal cost (MC) function by taking the derivative of the total
cost function with respect to quantity (Q):
MC = d(TC)/dQ = 6Q

Next, let's calculate the monopolist's marginal revenue (MR) by taking the derivative of the demand
function with respect to quantity (Q):
MR = d(TR)/dQ = d(P * Q)/dQ = P + dQ/dQ * dP/dQ
Since dQ/dQ equals 1, MR = P - Q/2

Set MC equal to MR and solve for the equilibrium quantity (Q):

6Q = P - Q/2
12Q = 2P - Q
13Q = 2P
P = (13/2)Q

Substitute the price back into the demand function to find the equilibrium quantity:
Q = 60 - 0.5P
Q = 60 - 0.5(13/2)Q
Q = 60 - (13/4)Q
(17/4)Q = 60
Q = (240/17)
Substitute the equilibrium quantity into the price function to find the equilibrium price:
P = (13/2)(240/17)
P = (1560/34)

Therefore, the short-run equilibrium output is Q = (240/17) and the equilibrium price is P = (1560/34).

(B) To find the profit of the monopolist, we need to calculate the total revenue (TR) and subtract the
total cost (TC). Total revenue is equal to the equilibrium price multiplied by the equilibrium quantity:
TR = P * Q
TR = (1560/34) * (240/17)

Total cost is equal to the cost function evaluated at the equilibrium quantity:
TC = 48 + 3Q^2
TC = 48 + 3((240/17)^2)

Profit (Π) is equal to TR minus TC:

Π = TR - TC

(C) To show the equilibrium price, output, and profit graphically, we can plot the demand function,
marginal cost function, and marginal revenue function on a graph. The intersection of the marginal
cost and marginal revenue curves represents the equilibrium quantity and price. The area under the
demand curve and above the marginal cost curve represents the monopolist's profit.

2) (A) To find the short-run equilibrium output and price levels, we need to find the level of output
where marginal cost equals marginal revenue.

First, let's find the marginal cost (MC) function. It can be obtained by taking the derivative of the total
cost function with respect to output (Q).

TC = 48 + 3Q^2
MC = dTC/dQ = 6Q

Next, let's find the marginal revenue (MR) function. It can be derived from the demand function.

Q = 60 - 0.5P
Solving for P, we get P = 120 - 2Q

Since the firm is a monopolist, MR is half the slope of the demand function.

MR = (dQ/dP) * (P/Q) = -0.5 * (120 - 2Q) / (60 - 0.5P) = -60 + Q

Setting MC equal to MR, we have:

6Q = -60 + Q
5Q = -60
Q = -12
Since negative output does not make sense, we ignore the negative value and conclude that the
short-run equilibrium output (Q) is 0.

To find the equilibrium price (P), we substitute Q = 0 into the demand function:
P = 120 - 2(0)
P = 120

Therefore, the short-run equilibrium output is 0 and the price is 120.

(B) To find the profit, we need to find the total revenue (TR) and subtract the total cost (TC).

TR = P * Q = 120 * 0 = 0
TC = 48 + 3(0^2) = 48

Profit = TR - TC = 0 - 48 = -48

The profit of the monopolist in the short run is -48.

(C) To illustrate the equilibrium graphically, we can plot the demand curve, the marginal cost curve,
and the marginal revenue curve on a graph.

The demand function is Q = 60 - 0.5P, which can be rewritten as: P = 120 - 2Q

The marginal cost curve is MC = 6Q.

The marginal revenue curve is MR = -60 + Q.

Plotting these curves on a graph will show the equilibrium price, output, and profit.

3) i. To calculate the price elasticity of demand and markup at the short-run equilibrium output and
price, we first need to find the values of Q and P at equilibrium.

From Question 2, we found that Q = 0 and P = 120 at equilibrium.

Price elasticity of demand (PED) is the percentage change in quantity demanded divided by the
percentage change in price.

PED = (dQ/dP) * (P/Q) = -0.5 * (120/0) = -infinity (perfectly elastic)

To calculate the markup, we need to find the difference between the price and marginal cost at
equilibrium.

Markup = P - MC = 120 - 6(0) = 120

ii. To find the value of price elasticity of demand when MR is 40 and price is 80, we need to
substitute these values into the demand function.
Q = 60 - 0.5P
Q = 60 - 0.5(80)
Q = 60 - 40
Q = 20

Now, we can calculate the price elasticity of demand using the formula:

PED = (dQ/dP) * (P/Q)

PED = -0.5 * (80/20)
PED = -2

iii. To find the level of output that makes MR zero, we set MR equal to zero and solve for Q.

MR = -60 + Q
0 = -60 + Q
Q = 60

The price level at this output level can be found by substituting Q = 60 into the demand function:

P = 120 - 2Q
P = 120 - 2(60)
P = 120 - 120
P=0

At this output level, the price is 0 and the total revenue (TR) is:

TR = P * Q = 0 * 60 = 0

The elasticity of demand at this output level is:

PED = (dQ/dP) * (P/Q) = -0.5 * (0/60) = 0

Therefore, the level of output that makes MR zero is 60, the price level is 0, the total revenue is 0,
and the elasticity of demand is 0.

4) In theory, a pure monopolist can earn a positive economic profit in the long run. This is because a
monopolist possesses market power and has the ability to set the price of their product above the
marginal cost. If the monopolist can maintain barriers to entry and prevent new competitors from
entering the market, they can continue to earn economic profits.

However, in the real world, maintaining a pure monopoly is challenging. Over time, potential
competitors may innovate, find substitutes, or discover ways to enter the market. Additionally,
regulatory authorities may intervene to promote competition. These factors make it difficult for a
monopolist to sustain their market power and continue earning positive economic profits in the long
run.
In summary, while a pure monopolist has the potential to earn positive economic profits in the long
run, various factors make it challenging to achieve and sustain such profits.

5) The long-run profit-maximizing condition or rule of a monopolist is different from the short-run one.
In the short run, a monopolist can earn economic profits or even incur losses. The profit-maximizing
condition in the short run for a monopolist is to produce where marginal revenue equals marginal
cost and the price is set at a level where demand intersects the marginal cost curve.

However, in the long run, a monopolist aims to maximize their total profit rather than just short-term
profit. The long-run profit-maximizing condition for a monopolist is based on achieving allocative
efficiency, where marginal cost equals marginal revenue, and producing at the quantity where that
equality occurs. This means that the monopolist sets the price equal to the marginal cost, eliminating
any economic profits. In other words, in the long run, a monopolist aims to minimize deadweight loss
and maximize consumer and producer surplus without earning economic profits.

Therefore, the long-run profit-maximizing condition for a monopolist differs from the short-run one.