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Suppose the demand functions facing the wireless telephone monopolist in Worked-Out Problem 18.4 (page 647) are Q1 = 80 - 50P for each low-demand consumer
Suppose the demand functions facing the wireless telephone monopolist in Worked-Out Problem 18.4 (page 647) are Q1 = 80 - 50P for each low-demand consumer and Q# = 200 - 50P for each high-demand consumer, where is the per-minute price in dollars. The marginal cost is $0.10 per minute. Suppose the monopolist offers only a single two-part tariff. Instructions: Round your answers to 2 decimal places as needed. a. What will be the monopolist's profit from each type of consumer if it charges a per-minute price of $0.10 and a fixed fee that causes both types of consumers to make a purchase? Profitlow = $ 70 0. Profithigh = $ 110 b. What if it charges a per-minute price of $0.20? Profitlow = $ Profithigh = $ c. If there are 500 high-demand consumers, how many low-demand consumers can there be for the monopolist to find the $0.20 price more attractive than the $0.10 price? 7900 low-demand consumers
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