The accompanying graph depicts the marginal revenue (MR), demand (D), and marginal cost (MC) curves for a monopoly. a. Place point P₁ at the profit maximizing price and quantity assuming that the monopolist can only charge a single price. b. What are the profits of the firm if it charges a single price? $ Suppose the monopolist able to successfully price discriminate between two groups by charging one group $60 and charging $35 to the other group. 2. What are the firm's profits if it charges the two prices as mentioned above? $ Price and Costs($) 100 95 90 85 80 75 70 65 60 55 50 45 40 35 30 25 20 15 10 5 0 MR P MC D 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95100 Quantity
The accompanying graph depicts the marginal revenue (MR), demand (D), and marginal cost (MC) curves for a monopoly. a. Place point P₁ at the profit maximizing price and quantity assuming that the monopolist can only charge a single price. b. What are the profits of the firm if it charges a single price? $ Suppose the monopolist able to successfully price discriminate between two groups by charging one group $60 and charging $35 to the other group. 2. What are the firm's profits if it charges the two prices as mentioned above? $ Price and Costs($) 100 95 90 85 80 75 70 65 60 55 50 45 40 35 30 25 20 15 10 5 0 MR P MC D 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 95100 Quantity
Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter24: Price-searcher Markets With High Entry Barriers
Section: Chapter Questions
Problem 15CQ
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