A monopolist sells in two markets. The inversedemand curve in market 1 is p1 = 200 – y1. Theinverse demand curve in market 2 is p2 = 400 –%Dy2. The firm's total cost function is c(y1 + y2) = (y1+ y2) 2. The firm is able to price discriminatebetween the two markets. What are the optimalprices?

The optimal price is the price at which a seller can make the most profit. In other words, the price…

demand curve in market 1 is p1 = 200 – y1. The inverse demand curve in market 2 is p2 = 400 – y2. The firm's total cost function is c(y1 + y2) = (y1 + y2) 2 . The firm is able to price discriminate between the two markets. What are the optimal prices?

demand curve in market 1 is p1 = 200 – y1. The inverse demand curve in market 2 is p2 = 400 – y2. The firm's total cost function is c(y1 + y2) = (y1 + y2) 2 . The firm is able to price discriminate between the two markets. What are the optimal prices?

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 monopolist sells in two markets. The inverse
demand curve in market 1 is p1 = 200 – y1. The
inverse demand curve in market 2 is p2 = 400 –
%D
y2. The firm's total cost function is c(y1 + y2) = (y1
+ y2) 2. The firm is able to price discriminate
between the two markets. What are the optimal
prices?

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