Question
Suppose you can separate consumers into two groups:Group 1 has a price elasticity of demand = -4 and group 2 has a price elasticity of
Suppose you can separate consumers into two groups:Group 1 has a price elasticity of demand = -4 and group 2 has a price elasticity of demand of -6.If you could conduct third degree price discrimination, which group would you charge a higher price to?Why?Suppose the the profit maximizing price for group 2 is $36.What price should I charge group 1?
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Microeconomics Principles, Problems and Policies
Authors: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn
20th edition
978-0077660819, 77660811, 978-1259450242
