Question

Suppose that a monopoly sells in two markets with the following demands: Market A PA=1000-QAand Market...

Suppose that a monopoly sells in two markets with the following demands: Market A PA=1000-QAand Market B: PB=800-2QB. Its Total Cost function is given by: TC=200Q. If monopoly practices third degree price discrimination, what are its combined profits (combined from both markets)?

Select one: a. $205,000 b. $263,750 c. $295,280 d. $315,000 e. None of the above

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
(a)    A firm wishes to third degree price discriminate to meet competition in two markets...
(a)    A firm wishes to third degree price discriminate to meet competition in two markets A and B. The firm’s total cost schedule is TC = $10*QA + $25*QB. Demands in the two markets are QA = 4,000*PA-1.5 and QB = 100,000*PA-2. The profit-maximizing prices to charge in markets A and B are: A         $20, $30.                     B.             $30, $50.                     C.             $40, $50                      D.             $60, $80                      E. None of the above. (b) Refer...
Suppose a monopoly sells to two identifiably different types of customers, A and B. The inverse...
Suppose a monopoly sells to two identifiably different types of customers, A and B. The inverse demand curve for group A is PA = 20 - QA, and the inverse demand curve for group B is PB = 20 - 2QB. The monopolist is able to produce the good for either type of customer at a constant marginal cost of 4, and the monopolist has no fixed costs. If the monopolist is unable to price discriminate (no reselling), (1) what...
Suppose a monopoly sells to two identifiably different types of customers, A and B. The inverse...
Suppose a monopoly sells to two identifiably different types of customers, A and B. The inverse demand curve for group A is PA= 20-QA, and the inverse demand curve for group B is PB= 20-2QB. The monopolist is able to produce the good for either type of customer at a constant marginal cost of 4, and the monopolist has no fixed costs. If the monopolist is unableto price discriminate (no reselling), (1) what arethe profit maximizing price and quantity, and...
Suppose a monopolist practices price discrimination in selling his product, charging different prices in two separate...
Suppose a monopolist practices price discrimination in selling his product, charging different prices in two separate markets. In the market A the demand function is PA = 100-qA and in B it is PB = 84-qB, where qA and qB are the quantities sold per week of A and B, PA and PB  are the respective prices per unit . If the cost function of the monopolist is c = 600 + 4 (qA + qB) A.How much should be sold...
2. Say a monopolist sells in two separate markets, with demand PA = 30 - 2Q...
2. Say a monopolist sells in two separate markets, with demand PA = 30 - 2Q (that is, the MRA = 30 – 4Q) and PB = 40 - Q (that is, the MRB = 40 – 2Q), respectively. Marginal costs in both markets are constant and equal to 10. What are the prices and quantities that the monopolist would charge in each market to maximize profit. (4 pts) Show your work. 3. A monopolist has marginal costs MC =...
Assume a monopolist is able to practice price discrimination in two separate markets. Each market has...
Assume a monopolist is able to practice price discrimination in two separate markets. Each market has a different demand curve for the monopolist’s product: Q1 = 1000 – 4P (Market 1: Maine) Q2 = 1200 – 4P (Market 2: Texas) Let the short-run total cost function for the monopolist be SRTC = 100 + 0.25Q2 a. Find the quantity and price at which the monopolist will sell in each market, and figure out the firm’s total profits from the combined...
1. A monopolist producer of a sailboat motor sells output in two geographically separated markets (East...
1. A monopolist producer of a sailboat motor sells output in two geographically separated markets (East and West Coasts).  Inverse demand and marginal revenue for the two markets are:  P1 = 2000 - Q1 and MR1 = 2000 - 2Q1 and P2 = 3000 - 2Q2 and MR2 = 3000 - 4Q2.  The monopolist’s total cost is C = 500,000 + 1000(Q1 + Q2). What are price, output, profits, marginal revenues, and deadweight loss for the following two cases:  (a)...
Suppose that a monopolist producing bicycles can divide the aggregate demand into two groups: The domestic...
Suppose that a monopolist producing bicycles can divide the aggregate demand into two groups: The domestic market and the foreign market. The demand curve for the monopolist’s product in the domestic market is y1=1200-10p1 and the demand curve for the monopolist’s product in the foreign market is y2=800-10p2. The monopolist’s total cost function is given by C(y)= 50y where y=y1+y2. a) Assume that the monopolist does not practice price discrimination. Calculate his/her profit-maximizing price-quantity combination and the maximum profit. b)...
2. Suppose that there is a firm that sells the same good in two different markets...
2. Suppose that there is a firm that sells the same good in two different markets and that it is able to prevent resale from the lower priced market to the higher priced market. The direct demand functions for the two markets are given by the following two equations: Q1 = 8- P1 Q2= 12- P2 Also, the firm produces this good in one plant, so the Total Cost function is given by the following equation: TC = 5 +...
You are the manager of a monopoly that sells a product to two groups of consumers...
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 -3, while group 2’s is -2. Your marginal cost of producing the product is $70. 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:...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT