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A monopolist produces golf balls. Assume that the inverse demand for golf balls is P=200-2Q and its MC=10. a) Calculate the optimal monopoly price and
A monopolist produces golf balls. Assume that the inverse demand for golf balls is P=200-2Q and its MC=10.
a) Calculate the optimal monopoly price and quantity when the monopolist charges a uniform market price.
b) Calculate the optimal prices (per unit price and fixed price) and quantity, if the monopolist decides to charge a two-part tariff.
c) Suppose the monopolist wants to offer a block tariff, and decides to charge for the first block a price of p1=160 and Q1=20. What is the optimal price and quantity for the second block?
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