Third degree price discrimination, Microeconomics

Assignment Help:

Question: Third degree price discrimination

Suppose that a monopolist faces two markets with demand curves given by

D(p₁) = 100 - p₁
D(p₂) = 100 - 2p₂

Assume that the marginal cost is constant at 20.

Suppose the monopolist can price discriminate.

(a) What is the maximization problem of the monopolist?

(b) What price should it charge in each market in order to maximize pro?ts?

Suppose now that the monopolist can't price discriminate.

(d) What price should it charge?

(e) Compare the pro?ts of price discrimation versus uniform pricing. Compare the consumer surplus with price discrimation and uniform pricing

Related Discussions:- Third degree price discrimination

#proposed merger between heinz and beech-nut scrutinized, Who are the compe...

Who are the competitors in the jarred baby food market? What market share do they have? How do Heinz and Beech-Nut compete with one another? Are the barriers to entry high or low f

What determines the price elasticity of demand, Question 1: i) Elaborat...

Question 1: i) Elaborate on the different types of price discrimination that a monopolist may use and what are the required preconditions for its application? ii) What dete

Theories of the firm, how a firm will choose its optimal inputs, isocosts a...

how a firm will choose its optimal inputs, isocosts and isoquants explanation

Reference electrodes, primary reference electrode,she

primary reference electrode,she

Profit margin, Profit Margin A measure of organization performance, pro...

Profit Margin A measure of organization performance, profit margins measure the percentage return an organization is earning over the cost of production of the items sold.

Consumer=m, consumer=m with the help of indifference curve analyis

consumer=m with the help of indifference curve analyis

Explain key assumptions and desired properties, Explain the key assumptions...

Explain the key assumptions and desired properties commonly used economics. Economists generally make all or some of the given key assumptions and a condition while they study

Macro economics, national income and what is used to measure it

national income and what is used to measure it

Elasticity, if you were making the pricing decision for the gasoline compan...

if you were making the pricing decision for the gasoline company, would you cut, raise or leae the price unchanged

Curves, how to map the curves

how to map the curves

Write Your Message!

Name

Email id

Message

Verfication Code

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

User Account

All Pages