Consider the monopolist firms. The total cost function is as follows: C = 10 + 2Q. There are two groups of consumers (10 consumers in each group) with the following demand functions: PH = 20 - QH PL = 14 - QL The firm applies second degree price discrimination, and sells two menus (packages), X and Y. The packages include nx and ny units of the product and prices are MX and My.X is designed for H consumers, and Y for L consumers. What is the optimum nx? a.6 b.14 c.20 d.18 e.12

Consider the monopolist firms. The total cost function is as follows: C = 10 + 2Q. There are two groups of consumers (10 consumers in each group) with the following demand functions: PH = 20 - QH PL = 14 - QL The firm applies second degree price discrimination, and sells two menus (packages), X and Y. The packages include nx and ny units of the product and prices are MX and My.X is designed for H consumers, and Y for L consumers. What is the optimum nx? a.6 b.14 c.20 d.18 e.12

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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