Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

(e) (10) Suppose that Larry is a rst-degree price discriminator, who charges a different price for each pie consumed. Find the quantity qI as well

image text in transcribedimage text in transcribed
image text in transcribedimage text in transcribed
(e) (10) Suppose that Larry is a rst-degree price discriminator, who charges a different price for each pie consumed. Find the quantity qI as well as the surplus to consumers CSI and producers PSI . How much qf does each consumer buy and what surplus 081-1 does each receive? (f) (10) Now suppose that Larry is a second-degree price discriminator who charges different prices depending on the quantity sold, by implementing a twopart tariff T (q) = a + pq. Calculate the parameters of the prot maximizing tariff a,\" and pH, and the total quantity (1\" . How much qu does each consumer buy, and what is the average price EU that each pays? (g) (10) Find the surplus to consumers CS'Hr and producers PS\" under the twopart tariff, as well as the deadweight loss DWLH. How much surplus 08;\" goes to each consumer? (100) Larry holds a monopoly in the market for pies, with no fixed costs and a constant marginal cost of c = 24. Moe, Curly, and Shemp are the three consumers who have the individual demand curves q1 (p) = 30 - 92 (p) = 20 - 93 (P) = 10

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Microeconomics

Authors: Austan Goolsbee, Steven Levitt, Chad Syverson

3rd Edition

1319105564, 978-1319105563

More Books

Students also viewed these Economics questions

Question

3 8 8 . .

Answered: 1 week ago