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Suppose there are two groups of consumers who purchase the same product. The demand curve of the first group of consumers P, = 100 -

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Suppose there are two groups of consumers who purchase the same product. The demand curve of the first group of consumers P, = 100 - Q, and the demand curve of the second group of consumers P2 = 200 - Q2. Assume these consumers are being served by only one firm, which has constant marginal cost and average total cost at 40 = MC = ATC. You may use graphs to help you visualize the problem, but the graphs will not be graded for marks and you must solve the problem algebraically or a zero will be assigned. (a) If this firm behaves like a perfectly competitive firm, calculate for each market segment the profit-maximizing output (Qf and Q{), the price consumers pay (Pf and PE), profit (if and Itz), producer surplus (PS; and PS2), consumer surplus (CS; and CSE), total surplus (TSf and TSE), and deadweight loss (DWL; and DW LZ). ( b ) If this firm practices third degree price discrimination, calculate for each market segment the profit-maximizing output (Q; and Q2), the price consumers pay (P; and P2), profit (nj and It2), producer surplus (PS; and PS2), consumer surplus (CS, and CS2), total surplus (TS; and TS2), and deadweight loss (DWL; and DWLz). (c) If this firm practices first degree price discrimination, calculate for each market segment the profit-maximizing output (Q, and Q2), the price consumers pay (Pp and P2 ), profit (7 ] and It2), producer surplus (PSP and PS2 ), consumer surplus (CSP and CSP), total surplus (TS, and TS2), and deadweight loss (DWL; and DWL2). (d) What do you observe from all your results

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