You are the manager of a monopoly that sells a product to two groups of consumers in different parts of the country. Group 1’s elasticity of demand is -5, while group 2’s is -4. Your marginal cost of producing the product is $30.
a. Determine your optimal markups and prices under third-degree price discrimination. Instructions: Enter your responses rounded to two decimal places. Markup for group 1:
Price for group 1:
Markup for group 2:
Price for group 2:
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