QUESTION 13 What is the deadweight loss, if Facebook acts as a single-price monopolist? QUESTION 14 In reality, Facebook charges different companies different amounts for ad campaigns, often systematically lowering the price of the ad campaign until the firm purchases. If Facebook is able to perfectly price discriminate, how many ad campaigns will it sell?
QUESTION 13 What is the deadweight loss, if Facebook acts as a single-price monopolist? QUESTION 14 In reality, Facebook charges different companies different amounts for ad campaigns, often systematically lowering the price of the ad campaign until the firm purchases. If Facebook is able to perfectly price discriminate, how many ad campaigns will it sell?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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please help with the two questions
Transcribed Image Text:QUESTION 13
What is the deadweight loss, if Facebook acts as a single-price
monopolist?
QUESTION 14
In reality, Facebook charges different companies different
amounts for ad campaigns, often systematically lowering the price
of the ad campaign until the firm purchases. If Facebook is able to
perfectly price discriminate, how many ad campaigns will it sell?
Transcribed Image Text:Facebook is the biggest seller of advertising space in the social
media market (Instagram is also a major seller, but it is owned by
Facebook). Assume that Facebook is a monopolist and is
illustrated by the graph below.
Use the below graph for #9 - 16.
P ($)
18
17
16
15
14
|1, 14.0
13
12
11
10
7
ATC
34, 1.4
4
|16, 1.8
D
3
31, 1.4
17, 1.8
2
MC
1
567 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34
Q (millions)
-1 0 1 2 3
-2
15, 1.9
MR
-3
What is the quantity of ads that Facebook sells?
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