Use the following to answer questions (1)-(6): Suppose a monopolist sells a product to consumers for which a particular consumer's choice is whether to buy 1 unit of the product or not to buy the product. In the absence of price discrimination, the market demand for the monopolist's product is: Q-150-%P. Further, the firm's short-run total cost is: TC-1000+ 1000. Now, knowing each consumer's reservation price, imagine the monopolist wishes to engage in first-degree price discrimination. [1] A particular consumer's reservation price corresponds to the maximum amount they a willing to pay to buy 1 unit of the product.
Use the following to answer questions (1)-(6): Suppose a monopolist sells a product to consumers for which a particular consumer's choice is whether to buy 1 unit of the product or not to buy the product. In the absence of price discrimination, the market demand for the monopolist's product is: Q-150-%P. Further, the firm's short-run total cost is: TC-1000+ 1000. Now, knowing each consumer's reservation price, imagine the monopolist wishes to engage in first-degree price discrimination. [1] A particular consumer's reservation price corresponds to the maximum amount they a willing to pay to buy 1 unit of the product.
Chapter14: Monopoly
Section: Chapter Questions
Problem 14.5P
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Question
can you please answer 4 to 6
![Use the following to answer questions (1)-(6): Suppose a monopolist sells a product to consumers for which
a particular consumer's choice is whether to buy 1 unit of the product or not to buy the product. In the
absence of price discrimination, the market demand for the monopolist's product is: Q-150-%P. Further,
the firm's short-run total cost is: TC-1000 + 100Q. Now, knowing each consumer's reservation price,
imagine the monopolist wishes to engage in first-degree price discrimination.
[1] A particular consumer's reservation price corresponds to the maximum amount they a willing to pay
to buy 1 unit of the product.
A.
B.
[2] Wishing to maximize profit from first-degree price discrimination, the monopolist should sell a
quantity equal to:
A. 50
B.
75
C.
100
D.
None of the above
[3] Continuing question (2), at the quantity chosen the consumer willing to pay the least for the product
has a reservation price exceeding $50.
A.
B.
[4]
A.
B.
C.
D.
[5]
True
False
A.
B.
C.
D.
[6]
A.
B.
True
False
Wishing to maximize profit from first-degree price discrimination, the maximum profit possible is:
$20,000
$10,000
$9,000
$4,000
Wishing to maximize profit from first-degree price discrimination, consumer surplus is:
$10,000
$2,500
$1,200
SO
Wishing to maximize profit from first-degree price discrimination, producer surplus exceeds $5,000.
True
False](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Faaddc3fc-ec97-4ca6-aaae-bb996b719b45%2Fbedfd424-ca2b-4440-a08c-80c306f99951%2Fe21l8vk.jpeg&w=3840&q=75)
Transcribed Image Text:Use the following to answer questions (1)-(6): Suppose a monopolist sells a product to consumers for which
a particular consumer's choice is whether to buy 1 unit of the product or not to buy the product. In the
absence of price discrimination, the market demand for the monopolist's product is: Q-150-%P. Further,
the firm's short-run total cost is: TC-1000 + 100Q. Now, knowing each consumer's reservation price,
imagine the monopolist wishes to engage in first-degree price discrimination.
[1] A particular consumer's reservation price corresponds to the maximum amount they a willing to pay
to buy 1 unit of the product.
A.
B.
[2] Wishing to maximize profit from first-degree price discrimination, the monopolist should sell a
quantity equal to:
A. 50
B.
75
C.
100
D.
None of the above
[3] Continuing question (2), at the quantity chosen the consumer willing to pay the least for the product
has a reservation price exceeding $50.
A.
B.
[4]
A.
B.
C.
D.
[5]
True
False
A.
B.
C.
D.
[6]
A.
B.
True
False
Wishing to maximize profit from first-degree price discrimination, the maximum profit possible is:
$20,000
$10,000
$9,000
$4,000
Wishing to maximize profit from first-degree price discrimination, consumer surplus is:
$10,000
$2,500
$1,200
SO
Wishing to maximize profit from first-degree price discrimination, producer surplus exceeds $5,000.
True
False
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