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A monopolist practices third degree price discrimination by separating its customers into two groups: consumers under 65 and senior citizens. The monopolists marginal oost is MC = 0.05q, where q is the total output in both markets. The marginal cost does not depend on the market in which the goods are sold. The demand curves are Adults: PA-25-1/6 x QA-25-0.1667 x QA Seniors: PS = 15-⅛xQs-15-0.125 x Qs ● . A. What is the total industry demand curve? (Rewrite each demand curve as Q in terms of P. The total industry demand curve is the total Q in tems of P, so add QAand Qs.) what is the price elasticity of demand for adults? (Use the equation of Q in terms of P to get aQaP and multiply by P/Q. Write the elasticity as a function of P) what is the price elasticity of demand for seniors? Which market is more elastic? (Elasticity depends on the price; for a given price, which market is more elastic?) в. C. D. E. what is the total revenue (TR) curve for adults? (TR = P x Q) F. What is the marginal revenue (MR) curve for adults? (MR TRaQ) G. What is the total revenue curve for seniors? H. What is the marginal revenue curve for seniors? I. Whatare the equilibrium quantities A and (Marginal cost is 0.05q, where q is the combined quantity for adults and seniors. Solve the simultaneous linear equations: (i)marginalrevenue for adults marginal cost, () marginal revenue for seniors marginal cost, and (i) adult quantity plus senior quantity total quantity.) What are the equilibrium prices PA and Ps? (Use the demand curve for each group of consumers; the prices are different.) what are the price elasticities of demand for the markets at their equilibrium prices? If price discrimination is prohibited, what the combined demand curve? (This is the industry demand curve worked out above; nothing new is required here.) J. K. L. M. If price discrimination is prohibited, what is the equilibrium quantity Oc? N. If price discrimination is prohibited, what is the equilibrium price Pc? O. What is the price elasticity of demand at the equilibrium price Pc? (These last three parts are monopoly pricing from the

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ADULTS SİNIO RS Ps O 12 5 Qs = 120-gps Q- 26 9.97-13.998 plstiity 119.27- 5.17 A enie lPs

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