This is a multi part problem: Suppose there are two types of consumers. The dema

Question

This is a multi part problem: Suppose there are two types of consumers. The demand for each type of consumer is given by:

Suppose a monopolist has a constant marginal cost = 6. Also, for parts a-b, assume that the monopolist is unable to distinguish between the two types on consumers.

a) What price should the monopolist charge?

b) How much profit will this monopolist make?

Now suppose the monopolist is able to distinguish between the two types of consumers and can effectively price discriminate between them.

c) What price should the monopolist charge to each type of consumer?

d) How much total profit does the price discriminating monopolist make?

e) Calculate the price elasticity for Type A and Type B consumers at the monopolist's profit maximizing price.

Any help for all parts of any parts would be greatly appreciated.

Explanation / Answer

open this file.. you will get your solution

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