# Question: jainas shoes inc js is a monopolist in the footwear...

###### Question details

Jaina's Shoes, INC. (JS) is a monopolist in the footwear industry. Its total cost function C(⋅) is given by the quadratic function of output C(Q) =100 – 5Q + Q2. The inverse demand function for shoes P(⋅) is given by the linear function P(Q) = 55 – 2Q. Note that the marginal cost C′(Q) is not constant. (Also, it happens to be negative for 0 ≤ Q < 2.5.)

(A) Compute the consumer surplus CS^c and producer surplus PS^c generated in the market for shoes if JS acted like a perfect competitor.

(B) Compute the deadweight loss resulting from the market power exercised by JS.