Consider the monopolist firms. The total cost function is as follows: C = 10 + 2Q. There are two groups of consumers (10 consumers in each group) with the following demand functions: PH = 20 - QH PL = 14 - QL The firm applies second degree price discrimination, and sells two menus (packages), X and Y. The packages include nx and ny units of the product and prices are MX and My.X is designed for H consumers, and Y for L consumers. What is the optimum nx? a.6 b.14 c.20 d.18 e.12

Consider the monopolist firms. The total cost function is as follows: C = 10 + 2Q. There are two groups of consumers (10 consumers in each group) with the following demand functions: PH = 20 - QH PL = 14 - QL The firm applies second degree price discrimination, and sells two menus (packages), X and Y. The packages include nx and ny units of the product and prices are MX and My.X is designed for H consumers, and Y for L consumers. What is the optimum nx? a.6 b.14 c.20 d.18 e.12

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter15: Monopoly

Section: Chapter Questions

Problem 6CQQ

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