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A market consists of two population segments, A and B. An individual in segment A has...

A market consists of two population segments, A and B. An individual in segment A has demand for your product q = 50 − p. An individual in segment B has
demand for your product q = 120 − 2p. Segment A has 1000 people in it. Segment B has 1200 people in it. Total cost of producing q units is C = 5000 + 20q.


a. What is total market demand for your product?


b. Assume that you must charge the same price to both segments. What is the profitmaximizing
price? What are your profits?


c. Imagine now that members of segment A all wear a scarlet “A” on their shirts or
blouses and that you can legally charge different prices to these people. What price
do you change to the scarlet “A” people? What price do you charge to those without
the scarlet “A”? What are your profits now?

(I'm having some struggle to understand so can u explain your answer a little bit detailed? Thank you!)

business   economics   
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Answer #1

Ans>ev Theve one tuo segmends aulati n A and B a. Tolal market demand the Podct: In ma ket A : Total revenue ą,, (So-*):So Hargnal revenue So-29 na/ginal cost :a。 In eayui Nbv.um -92 In make Total veve nue (o -o-sa) -o -o.sq2 Marginal revenve 60- Harg nai cost 2 o MakJo tie J*m Charges Same Price bth segments; Total revenue (ys) *(1709,-92 Marginal Yevenue (V3) * (IPO-29) Mav ginal cast =20 In eauil. brium, I - ss units *3s) t(4°.m)-(s。。。+2.ss):52SA16。。-Sil。ว.2475

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