A wholesaler produces a good which is sold directly to consumers and to retailers. The demand curve functions for consumers and retailers are, respectively, P1= 40-0.4Q1 P2 30-0.1Q2 The firm's total cost function is: TC= 220 + 120 Calculate the output and price in each market and profit of each firm when there is price discrimination.

A wholesaler produces a good which is sold directly to consumers and to retailers. The demand curve functions for consumers and retailers are, respectively, P1= 40-0.4Q1 P2 30-0.1Q2 The firm's total cost function is: TC= 220 + 120 Calculate the output and price in each market and profit of each firm when there is price discrimination.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter12: Price And Output Determination: Oligopoly

Section: Chapter Questions

Problem 5E

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