onopolist if it can charge different prices in these markets? 2. What is the optimal price if the monopolist must charge the same price in each market? 3. How much total consumers’ surplus changes between the two separate prices and the same price cases?
onopolist if it can charge different prices in these markets? 2. What is the optimal price if the monopolist must charge the same price in each market? 3. How much total consumers’ surplus changes between the two separate prices and the same price cases?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Suppose a monopolist faces two markets withdemand
D1(p1) = 200 − p1
D2(p2) = 100 − 2p2
Assume that the monopolist’s cost function is c(y) = y2
1. What is the optimal prices for the monopolist if it can charge different prices in these markets?
2. What is the optimal
3. How much total
price cases?
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