Problem 1. Suppose that a monopolist with MC = 0 faces two consumers with demand curves given by D₁ (P₁) = 42 - P1, D₂ (P2) = 21 - 1/2p2 a) Suppose the monopolist can tell the consumers apart. Find the optimal (profit-maximizing) pair of price-quantity packages. b) Please, find the optimal (profit-maximizing) pair of price-quantity pack- ages for the case when the monopolist can not tell the consumers apart.

Problem 1. Suppose that a monopolist with MC = 0 faces two consumers with demand curves given by D₁ (P₁) = 42 - P1, D₂ (P2) = 21 - 1/2p2 a) Suppose the monopolist can tell the consumers apart. Find the optimal (profit-maximizing) pair of price-quantity packages. b) Please, find the optimal (profit-maximizing) pair of price-quantity pack- ages for the case when the monopolist can not tell the consumers apart.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter14: Monopoly

Section: Chapter Questions

Problem 14.5P

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