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We want to show that when a monopolist uses two-part pricing and faces identical consumers, charging... a price higher or lower than the competitve price,
We want to show that when a monopolist uses two-part pricing and faces identical consumers, charging...
a price higher or lower than the competitve price, P= 10 (with a lump-sum fee equal to consumer surplus), reduces the monopoly's prots. The gure to the rig ht shows the demand curve for a representative consumer. Determine the prots (per-unit prots + collected fee from the consumer) for each of the following per-unit prices. Assume xed costs are negligible. Prot from two-part pricing when price is p = 10 equals $|:|. (Round to two decimal places.) Prot from a two-part pricing when price is p = 30 equals $El. (Round to two decimal places.) Prot from a two-part pricing when price is p = 5 equals $|:|. (Round to two decimal places.) 120- 110- 100- 90- p, $ per unit m D 0- 0 10 20 30 40 50 60 70 80 90 100 110 120 q, Units per dayStep by Step Solution
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