Question

True or False: If they could, the customers of an ordinary (non-pricediscriminating, non-admission-charging) monopolist would get together and bribe the monopolist to charge lower prices. Justify your answer by discussing how much the customers would be willing to offer and how much the monopolist would be willing to accept.

Answer 1

Answer :- The statement given above is False, Because, to charge a lower price, the group of customers can Graf the ordinary monopolist.

• There are very differences between ordinary monopolist and discriminating monopolist.
• Charges of discriminating monopolist for different customers are different,On the other hand, ordinary monopolist charges are same for all customers. So that the price is settled by ordinary monopolist to gain maximum revenue.
• A monopolist cannot take graft from his customers because they already set a fixed price for their customers.
• In case if the monopolist take graft and the price of the product become lower, there will a loss in the overall period for the monopolist, therefore a monopolist can never take graft and charge a lower price for their products.