b. Which of the following are necessary conditions for third-degre Instructions: In order to receive full credit, you must make a selection for each option. For correct answe once to place a check mark. For incorrect answer(s), click twice to empty the box. 7 There are two different groups with different (and identifiable) elasticities of demand. 7 At least one group has elasticity of demand greater than 1 in absolute value. 7 At least one group has elasticity of demand less than one in absolute value.
b. Which of the following are necessary conditions for third-degre Instructions: In order to receive full credit, you must make a selection for each option. For correct answe once to place a check mark. For incorrect answer(s), click twice to empty the box. 7 There are two different groups with different (and identifiable) elasticities of demand. 7 At least one group has elasticity of demand greater than 1 in absolute value. 7 At least one group has elasticity of demand less than one in absolute value.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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6
![b. Which of the following are necessary conditions for third-degree price discrimination to enhance profits.
Instructions: In order to receive full credit, you must make a selection for each option. For correct answer(s), click the box
once to place a check mark. For incorrect answer(s), click twice to empty the box.
7 There are two different groups with different (and identifiable) elasticities of demand,
7 At least one group has elasticity of demand greater than 1 in absolute value.
At least one group has elasticity of demand less than one in absolute value.
? We are able to prevent resale between the groups.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F4f747923-27ef-48af-8a3a-fa1aa203e7a4%2Fd384d2f2-4a60-4d07-a072-36b4472117b6%2Fwvic8kh_processed.jpeg&w=3840&q=75)
Transcribed Image Text:b. Which of the following are necessary conditions for third-degree price discrimination to enhance profits.
Instructions: In order to receive full credit, you must make a selection for each option. For correct answer(s), click the box
once to place a check mark. For incorrect answer(s), click twice to empty the box.
7 There are two different groups with different (and identifiable) elasticities of demand,
7 At least one group has elasticity of demand greater than 1 in absolute value.
At least one group has elasticity of demand less than one in absolute value.
? We are able to prevent resale between the groups.
![You are the manager of a monopoly that sells a product to two groups of consumers in different parts of the country.
Analysts at your firm have determined that group 1's elasticity of demand is -5, while group 2's is -3. Your marginal cost of
producing the product is $40.
Instructions: Enter your responses rounded to two decimal places.
a. Determine your optimal markups and prices under third-degree price discrimination.
Markup for group 1:
Price for group 1: $
Markup for group 2:
Price for group 2: $1
b. Which of the following are necessary conditions for third-degree price discrimination to enhance profits.
Instructions: In order to receive full credit, you must make a selection for each option. For correct answer(s), click the box
once to place a check mark. For incorrect answer(s), click twice to empty the box.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F4f747923-27ef-48af-8a3a-fa1aa203e7a4%2Fd384d2f2-4a60-4d07-a072-36b4472117b6%2Fofemf3k_processed.jpeg&w=3840&q=75)
Transcribed Image Text:You are the manager of a monopoly that sells a product to two groups of consumers in different parts of the country.
Analysts at your firm have determined that group 1's elasticity of demand is -5, while group 2's is -3. Your marginal cost of
producing the product is $40.
Instructions: Enter your responses rounded to two decimal places.
a. Determine your optimal markups and prices under third-degree price discrimination.
Markup for group 1:
Price for group 1: $
Markup for group 2:
Price for group 2: $1
b. Which of the following are necessary conditions for third-degree price discrimination to enhance profits.
Instructions: In order to receive full credit, you must make a selection for each option. For correct answer(s), click the box
once to place a check mark. For incorrect answer(s), click twice to empty the box.
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