+1-415-670-9189
info@expertsmind.com
Unable to distinguish between the two types of consumers
Course:- Microeconomics
Reference No.:- EM13700143




Assignment Help
Assignment Help >> Microeconomics

Suppose there are two types of consumers: Type A and Type B. The demands for a monopolist’s product for each type of consumers are given by:

Type A: Q = 80 – 2P

Type B: Q = 60 – 3P

Assume the marginal cost of production is constant and MC = 4, and there are no fixed costs.

a) Suppose the firm is unable to distinguish between the two types of consumers, and therefore cannot engage in price discrimination. Sketch the demand curve facing the firm. Make sure your graph is accurate and carefully labeled.

b) What price will the monopolist charge?

c) How much profit will the monopolist make?

d) If the monopolist is able to charge different prices to each type of consumer, what price will she charge to type A consumers?

e) If the monopolist is able to charge different prices to each type of consumer, what price will she charge to type B consumers?

f) How much profit will the monopolist make if it can price discriminate?




Put your comment
 
Minimize


Ask Question & Get Answers from Experts
Browse some more (Microeconomics) Materials
Suppose there is a tax cut, holding constant government purchases and all other factors affecting the AD curve. Illustrate the short run effects on output and the price level
A buyer of a product knows that 20 percent of sellers are dishonest and will sell a defective product (if they can get away with it). The seller has to pay $15 to buy the prod
Compute the price, output, and profit contribution if the product is not certified. Compute the price, output, and profit contribution if the product is certified. Should the
A firm owns and manages rental properties is considering buying a building that would cost $800,000 this year, but would yield an annual revenue stream of $80,000 per year f
Using the aggre- gate demand-aggregate supply model, illustrate an econ- omy with an expansionary gap. If the government is to close the gap by changing government purchases
W(sub)a= 1/a1(Y1)+1/a2(Y2)+1/a3(Y3)+1/a4(Y4) where a(i) are the constants. a) What restriction on the ai is needed for Wa to be an unbiased estimator of mu? b) Find the varian
How much economic profit can be achieved at each level of output? If price is $10.00, how much will be produced in the short run? Using the price of $4, answer the previous
A three-page paper covering specific topics to consider when analyzing the current changes in your preferred long-term facility is due. Using the information learned in th