A monopolist is deciding how to allocate output between two geographically separated markets (East Coast and Midwest). Demand and marginal revenue for the two markets are: P1=20−Q1 MR1=20−2Q1P2=30−2Q2 MR2=30−4Q2 The monopolist's total cost is C=5+5(Q1+Q2). What are price, output, profits, marginal revenues, and deadweight loss if the monopolist can price discriminate? (round all answers to two decimal places)In market 1, the price is $12.50 and the quantity is 7.50In market 2, the price is $17.50and the quantity is 6.25

The equilibrium condition of monopoly reflecting the profit maximization point is one where marginal…

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ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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A monopolist is deciding how to allocate output between two geographically separated markets (East Coast and Midwest). Demand and marginal revenue for the two markets are:

P₁=20−Q₁ MR₁=20−2Q₁

P₂=30−2Q₂ MR₂=30−4Q₂

The monopolist's total cost is C=5+5(Q₁+Q₂).

What are price, output, profits, marginal revenues, and deadweight loss if the monopolist can price discriminate? (round all answers to two decimal places)

In market 1, the price is $12.50 and the quantity is 7.50

In market 2, the price is $17.50and the quantity is 6.25

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