AgK rents out computing services to agricultural producers. The charge a fixed rental payment for the right to unlimited computing at a rate of P USD per minute. There are two types of potential users: 100 farmers and 100 ranchers. Each farmer demand is given by Qf = 20 - Pf, and each rancher's demand is given by Qr = 25 - Pr, where Q is in 1000 minutes per month and P is in USD per minutes. The marginal cost is 5 USD per minute. Suppose that you could separate farmers and ranchers. For ranchers, the optimal rental fee is A) 5 B) 200,000 C) 500 D) 0
AgK rents out computing services to agricultural producers. The charge a fixed rental payment for the right to unlimited computing at a rate of P USD per minute. There are two types of potential users: 100 farmers and 100 ranchers. Each farmer demand is given by Qf = 20 - Pf, and each rancher's demand is given by Qr = 25 - Pr, where Q is in 1000 minutes per month and P is in USD per minutes. The marginal cost is 5 USD per minute. Suppose that you could separate farmers and ranchers. For ranchers, the optimal rental fee is A) 5 B) 200,000 C) 500 D) 0
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
Chapter11: Price And Output Determination: Monopoly And Dominant Firms
Section: Chapter Questions
Problem 3E
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AgK rents out computing services to agricultural producers. The charge a fixed rental payment for the right to unlimited computing at a rate of P USD per minute. There are two types of potential users: 100 farmers and 100 ranchers. Each farmer
Suppose that you could separate farmers and ranchers. For ranchers, the optimal rental fee is
| A) 5 |
| B) 200,000 |
| C) 500 |
| D) 0 |
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