The following graph shows the demands and marginal revenue in two markets, 1 and 2, for a price discriminating firm along with total marginal revenue, MRT, and marginal cost.Price and cost (dollars)5040302010050Multiple ChoiceO100150What price should the firm charge in each market?P₁ = $20, P₂ = $32.50P₁ = $35. P₂- $22.50=P₁ = $20, P2 = $20200P₁ = $27.50, P₂ = $35MR2250QuantityMC300D₁L350Impossible to say because market demand is not given.MRT400450D₂500Q

A selling tactic known as price discrimination involves charging clients various rates for the same…

The following graph shows the demands and marginal revenue in two markets, 1 and 2, for a price discriminating firm along with total marginal revenue, MRT, and marginal cost. Price and cost (dollars) 50 40 20 10 0 50 100 150 200 MR₂ 250 Quantity What price should the firm charge in each market? MC 300 D₁ 350 MRT 400 450 D₂ 500 Q

The following graph shows the demands and marginal revenue in two markets, 1 and 2, for a price discriminating firm along with total marginal revenue, MRT, and marginal cost. Price and cost (dollars) 50 40 20 10 0 50 100 150 200 MR₂ 250 Quantity What price should the firm charge in each market? MC 300 D₁ 350 MRT 400 450 D₂ 500 Q

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The graph below shows the demands and marginal revenue in two markets, 1 and 2, for a price discriminating firm along with total marginal revenue, MRT, and marginal cost: Price and cost (dollars) 100 80 60 AS 40 20 0 200 100 300 MR1 400 MR2 MC 500 Quantity How should the firm allocate sales between the two markets? 600 D₁ 700 MRT 800 900 D₂ 1000 Q
A friend has just started up her own business. Her firm asks you how much to charge for her product to maximize profits. The demand schedule for it is given by the first two columns in the table below; its total costs are given in the third column. For each level of output, you can calculate total revenue, marginal revenue, average cost, and marginal cost. The profit-maximizing level of output can be found at the point where TR - TC is greatest, or where MR = MC, (or the last quantity where MR is still greater than MC.) What is the profit-maximizing level of output for her product? 40 How much will she earn in profits? 80 Price Quantity TC TR? MR? MC? $25.00 0 $130 $24.00 10 $275 $23.00 20 $435 $22.50 30 $610 $22.00 40 $800 $21.60 50 $1,005 $21.20 60 $1,225
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