Title: Monopoly Firm: Maximization of Profit

Contents

A company hires you as a management consultant. It wants to build a vacation destination on Partridge Island, including i) cottages for rent; ii) a restaurant; iii) a ferryboat service. These services do not exist yet, but the company believes it will be very profitable.

a) How will the company maximize its profits (or minimize losses) its first year, while it is a monopoly firm? Give concrete examples by referring to the cottages, restaurant and ferry. What advantages does it have in its first year and how can it maximize profits? What are the risks associated with this strategy?

Number of words inclusive of question a above and title: 613

The only source used is indicated below:

Ragan, C. (2013). Microeconomics (14th ed.). Toronto, ON: Pearson Education Canada.