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5. Two-Part Tari': Consider a monopolist in a market in which the price at which each consumer is willing to pay to buy q units
5. Two-Part Tari': Consider a monopolist in a market in which the price at which each consumer is willing to pay to buy q units is p(q) : a q. Suppose that the monopolist has cost function C(q) : qg. (a) If the rm sets the same price each unit sold, calculate the price and quantity in the market. What are the rm's prots, the consumer surplus, and the deadweight loss when the same price is set for each unit sold? (1)) Calculate the optimal two-part tariff and the resulting quantity in the market. What are the rm's prots, the consumer surplus, and the deadweight loss with the two-part tariff
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