6. A monopolist has discovered that the inverse demand function of a person with income M...
6. A monopolist has discovered that the inverse demand function of a person with income M for the monopolists product is p = 2M − q. The monopolist has a total cost function, c(q) = 100q. The monopolist is able to observe the incomes of its consumers and to practice price discrimination according to income (second-degree price discrimination).
(a) Draw the demand function of consumers with income ML and those with income MH , with ML < MH . [20%]
(b) Determine the price which consumers pay. [35%]
(c) Now assume that legislation comes into effect that stops the monopolist from charging different prices for individuals with different incomes. Suppose half of the individuals have income ML and the other half have income MH. Determine the price that the monopolist charges. Who benefits from the legislation? [45%]
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6. A monopolist has discovered that the inverse demand function
of a person with income M...
A monopolist has discovered that the inverse demand function of a person with income M for...
A monopolist has discovered that the inverse demand function of a person with income M for the monopolists product is p = 2M −q. The monopolist has a total cost function, c(q) = 100q. The monopolist is able to observe the incomes of its consumers and to practice price discrimination according to income (second-degree price discrimination). (a) Draw the demand function of consumers with income ML and those with income MH, with ML < MH. [20%] (b) Determine the price...
A monopolist has a total cost function TC = 8Q2 + 100. The inverse demand function...
A monopolist has a total cost function TC = 8Q2 + 100. The inverse demand function for the monopolist is P = 18- Q. What is the optimal price for the monopolist and what is consumer surplus
Question 6 Suppose that a monopolist faces an inverse demand curve, P(y) = 50 - y,...
Question 6 Suppose that a monopolist faces an inverse demand curve, P(y) = 50 - y, and a cost function, C(Y) = 20y + y2. If this monopolist is able to practice perfect price discrimination, then his total profit will be
A monopolist has a cost function C(Q) = 202 + Q He faces an inverse demand...
A monopolist has a cost function C(Q) = 202 + Q He faces an inverse demand curve p = 25 – 29 What is the profit-maximising price for the monopolist? 06 09 011 13 A none of the above
A monopolist’s inverse demand is P=500-2Q, the total cost function is TC=50Q2 + 1000Q and Marginal...
A monopolist’s inverse demand is P=500-2Q, the total cost function is TC=50Q2 + 1000Q and Marginal cost is MC=100Q+100, where Q is thousands of units. a). what price would the monopolist charge to maximize profits and how many units will the monopolist sell? (hint, recall that the slope of the MARGINAL Revenue is twice as steep as the inverse demand curve. b). at the profit-maximizing price, how much profit would the monopolist earn? c). find consumer surplus and Producer surplus...
Consider a monopolist facing the following inverse demand function: P = 200 - Q The total...
Consider a monopolist facing the following inverse demand function: P = 200 - Q The total cost function is given by C = 100 + 50Q + 0.5Q^2 What is the monopolist's uniform profit-maximizing price? a. 130 b. 140 c. 150 d. 160
ow our monopolist faces two types of customers: Type A has the inverse demand functi -300-5QA...
ow our monopolist faces two types of customers: Type A has the inverse demand functi -300-5QA while type B has the inverse demand function P 150-5QB. The total function is still C 50Q 4a) If the monopolist can only charge uniform, linear prices but can distinguish between the two types and prevent resale (G.e., third-degree group price discrimination), what price will it charge on cost each type, and how much will each type buy and how much consumer surplus will...
2. A monopolist has a cost function given by TC 250+q+.004q2. The inverse market demand for...
2. A monopolist has a cost function given by TC 250+q+.004q2. The inverse market demand for boxes is given by p-8-.0010. The monopolist is currently able to exclude rivals from the market because of a special governmental zoning rule. (a) What is its output and what price does it charge for boxes? (b) Calculate the firm's profit at this output level. (c) Calculate the firm's producer's surplus at this output level (d) Calculate the consumer's surplus in this situation
2. A monopolist has a cost function given by TC 250+q+.004q2. The inverse market demand for...
2. A monopolist has a cost function given by TC 250+q+.004q2. The inverse market demand for boxes is given by p 8-.0010. The monopolist is currently able to exclude rivals from the market because of a special governmental zoning rule. (a) What is its output and what price does it charge for boxes? (b) Calculate the firm's profit at this output level. (c) Calculate the firm's producer's surplus at this output level. (d) Calculate the consumer's surplus in this situation.
6. The market demand is given by p() 36 q and a monopolist has the following...
6. The market demand is given by p() 36 q and a monopolist has the following (a) If the monopolist charges a uniform price (fixed price per ut), how much (b) If the monopolist can perfectly price discriminate (first degree), how muclh (c) How much extra surplus does the monopolist capture by price discriminating cost function TC() 24q would she produce and what is the price? What is the profit? would she produce? What is her profit? instead of charging...
Question 6 Suppose that a monopolist faces an inverse demand curve, P(y) = 50 - y, and a cost function, C(Y) = 20y + y2. If this monopolist is able to practice perfect price discrimination, then his total profit will be
A monopolist has a cost function C(Q) = 202 + Q He faces an inverse demand curve p = 25 – 29 What is the profit-maximising price for the monopolist? 06 09 011 13 A none of the above
ow our monopolist faces two types of customers: Type A has the inverse demand functi -300-5QA while type B has the inverse demand function P 150-5QB. The total function is still C 50Q 4a) If the monopolist can only charge uniform, linear prices but can distinguish between the two types and prevent resale (G.e., third-degree group price discrimination), what price will it charge on cost each type, and how much will each type buy and how much consumer surplus will...
2. A monopolist has a cost function given by TC 250+q+.004q2. The inverse market demand for boxes is given by p-8-.0010. The monopolist is currently able to exclude rivals from the market because of a special governmental zoning rule. (a) What is its output and what price does it charge for boxes? (b) Calculate the firm's profit at this output level. (c) Calculate the firm's producer's surplus at this output level (d) Calculate the consumer's surplus in this situation
2. A monopolist has a cost function given by TC 250+q+.004q2. The inverse market demand for boxes is given by p 8-.0010. The monopolist is currently able to exclude rivals from the market because of a special governmental zoning rule. (a) What is its output and what price does it charge for boxes? (b) Calculate the firm's profit at this output level. (c) Calculate the firm's producer's surplus at this output level. (d) Calculate the consumer's surplus in this situation.
6. The market demand is given by p() 36 q and a monopolist has the following (a) If the monopolist charges a uniform price (fixed price per ut), how much (b) If the monopolist can perfectly price discriminate (first degree), how muclh (c) How much extra surplus does the monopolist capture by price discriminating cost function TC() 24q would she produce and what is the price? What is the profit? would she produce? What is her profit? instead of charging...
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