Finder File Edit View Go Window Help Q Thu Apr 11 7:24 PM ng.cengage.com C + . DOCX_ Home D2L Price Discrimination - ECO-201-T4890 Microeconomics 24EW4 Mind Tap - Cengage Learning Chrome Resume Richard CENGAGE | MINDTAP Q Search this course 2 Module Six Quiz X HOME 1 . Profit maximization and loss minimization PROFILE Lagatt Green is a monopoly beer producer and distributor operating in the hypothetical economy of Lightington. Assume that Lagatt Green is not able ORDERS price discriminate, and so it sells its beer to all customers at the same price per bottle. The following graph gives the marginal cost (MC), marginal A-Z revenue (MR), average total cost (ATC), and demand (D) curves that Lagatt Green faces for beer in Lightington. RENTALS Place the black point (plus symbol) on the graph to indicate the profit-maximizing price and quantity for Lagatt Green. If Lagatt Green is making a EI COURSES profit, use the green rectangle (triangle symbols) to shade in the area representing its profit. On the other hand, if Lagatt Green is suffering a loss, use the purple rectangle (diamond symbols) to shade in the area representing its loss. 1 2 Study Tools pongo 4.00 College Success Tips 3.50 Monopoly Outcome Career Success Tips 3.00 ATC ? Help 2.50 Profit At 2.00 PRICE (Dollars per bottle) 1.50 Loss - SIGN OUT MC 1.00 O 0.50 2 APR ICO 11 stv 4 IBIId Finder File Edit View Go Window Help & ThuApr11 7:24PM 'DO('.XJ @ ng.cengage.com LEEITT Y 2, Richard 7 2 CENGAGE ' MINDTAP Q Search this course Module Six Quiz X Suppose Lagatt Green charges $2.75 per bottle. Your study partner Gabriel says that because Lagatt Green is a monopoly with market power, it should charge the higher price of $3.00 per bottle in order to increase its profit. PROFILE ORDERS A\\ Complete the following table to determine whether Gabriel is correct. Price Quantity Demanded Total Revenue Total Cost Profit COURSES v (Dollars per bottle) (Cans) (Dollars) (Dollars) (Dollars) 2.75 v A 3.00 > Study Tools Given the earlier information, Gabriel correct in his assertion that Lagatt Green should charge $3.00 per bottle. College Success Tips Suppose that a technological innovation decreases Lagatt Green's costs so that it now faces the marginal cost (MC) and average total cost (ATC) given on the following graph. Specifically, the technological innovation causes a decrease in average fixed costs, thereby lowering the ATC curve and moving the MC curve. Career Success Tips Help Place the black point (plus symbol) on the following graph to indicate the profit-maximizing price and quantity for Lagatt Green. If Lagatt Green is making a profit, use the green rectangle (triangle symbols) to shade in the area representing its profit. On the other hand, if Lagatt Green is suffering a loss, use the purple rectangle (diamond symbols) to shade in the area representing the loss. Finder File Edit View Go Window Help Q Thu Apr 11 7:24 PM