A local magic shop has a monopoly on the production of magic wands. Each customer war wand, and the table below shows each customer's willingness to pay. The marginal cost of $21 no matter how many are produced. Quantity demanded Price per wand ($) 0 1 2 3 4 5 6 7 8 30 27 24 21 18 15 12 9 6

A local magic shop has a monopoly on the production of magic wands. Each customer war wand, and the table below shows each customer's willingness to pay. The marginal cost of $21 no matter how many are produced. Quantity demanded Price per wand ($) 0 1 2 3 4 5 6 7 8 30 27 24 21 18 15 12 9 6

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

A local magic shop has a monopoly on the production of magic wands. Each customer wants only one magic
wand, and the table below shows each customer's willingness to pay. The marginal cost of producing a wand is
$21 no matter how many are produced.
Quantity demanded
Price per wand ($)
LO
01 2 3 4 5
6 78
30 27 24 21 18 15 12 96
If the shop can charge only a single price, it will charge $
wands.
If the firm practices perfect price discrimination, it will sell a total of
earn a profit of $|
and sell
wands and

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