2. Based on the following graph (which summarizes the demand, marginal revenue, and relevant costs for your product), determine your firm's optimal price, output, and the re- sulting profits for each of the following scenarios: (LO2) a. You charge the same unit price to all consumers. b. You engage in first-degree price discrimination. c. You engage in two-part pricing. d. You engage in block pricing. Price 110 100 90 80 70 60 50 40 30 20 10 0- MR MC-AC -D 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Quantity

Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter23: Managing Vertical Relationships
Section: Chapter Questions
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2. Based on the following graph (which summarizes the demand, marginal revenue, and
relevant costs for your product), determine your firm's optimal price, output, and the re-
sulting profits for each of the following scenarios: (LO2)
a. You charge the same unit price to all consumers.
b. You engage in first-degree price discrimination.
c. You engage in two-part pricing.
d. You engage in block pricing.
Price
110
100
90
80
70
60
50
40
30
20
10
0-
MR
MC-AC
-D
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Quantity
Transcribed Image Text:2. Based on the following graph (which summarizes the demand, marginal revenue, and relevant costs for your product), determine your firm's optimal price, output, and the re- sulting profits for each of the following scenarios: (LO2) a. You charge the same unit price to all consumers. b. You engage in first-degree price discrimination. c. You engage in two-part pricing. d. You engage in block pricing. Price 110 100 90 80 70 60 50 40 30 20 10 0- MR MC-AC -D 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Quantity
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