Moderate# Monopoly: Underachieve, Overprofit!

MICRO-JD0GRJ

Consider a monopoly with the following curves:

Marginal cost $MC = 6Q$, Average Total Cost $ATC = \frac{50}{Q}+3Q$, demand $P = 50-2Q$, and Marginal Revenue $MR = 50-4Q$.

This firm will decide to produce a monopoly quantity $Q_M$ that maximizes their profits. However, the *efficient* quantity that maximizes *total surplus* is $Q_E$, which is higher than $Q_M$.

*How many more units would the monopoly need to produce to make the efficient level?* That is, *what is $Q_E-Q_M$?*