A monopolist has two types of customers, type 1 (small) has individual demand p = 1-q, type
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Question:
A monopolist has two types of customers, type 1 (small) has individual demand p = 1-q, type 2 (big) has individual demand p = 10-q. There are N customers, 95% of customers are small, 5% are big. Price discrimination is not allowed. Marginal cost equals 0.2. Find the optimal price and resulting profit and establish whether all customers will be served.
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