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PERUNAT TERIAMASINITIA The demand functions for markets H and L are gives as follows: PH=20-QH PL = 10 - QL The total cost function
PERUNAT TERIAMASINITIA The demand functions for markets H and L are gives as follows: PH=20-QH PL = 10 - QL The total cost function of the monopolist firm is as follows: C = 10 + 5Q a) Assume that the monopolist firm applies a uniform price (same price for these two markets). What is the optimum price? b) Assume that the monopolist firm applies 3rd degree price discrimination. What are the optimum prices? c) Assume that the monopolist firm applies two part pricing in both markets. What are the optimum prices?
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a If the monopolist firm applies a uniform price it will set the same price for both markets To find the optimum price we need to find the profitmaximizing quantity for each market and then set the sa...
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Microeconomics An Intuitive Approach with Calculus
Authors: Thomas Nechyba
1st edition
538453257, 978-0538453257
