The demand function of a monopolist serving a homogenous group of consumers is p
ID: 1201992 • Letter: T
Question
The demand function of a monopolist serving a homogenous group of consumers is p=3-Q. Assume marginal cost is 1A) design a pricing offer where consumers get 1 unit at a certain price and the second unit at a discounted price
B) design a pricing offer where consumers get 1 unit at a certain price and the second unit for free The demand function of a monopolist serving a homogenous group of consumers is p=3-Q. Assume marginal cost is 1
A) design a pricing offer where consumers get 1 unit at a certain price and the second unit at a discounted price
B) design a pricing offer where consumers get 1 unit at a certain price and the second unit for free
A) design a pricing offer where consumers get 1 unit at a certain price and the second unit at a discounted price
B) design a pricing offer where consumers get 1 unit at a certain price and the second unit for free
Explanation / Answer
A) Design a pricing offer where consumers get 1 unit at a certain price and the second unit at a discounted price
Price of good 1 = 3-1 = 2
Price of good 2 = 3-2 = 1
Total Price of the good = 3
Total cost of good = 2
Buy 1 and get 50% off on the second
B) design a pricing offer where consumers get 1 unit at a certain price and the second unit for free
Total Price of the good = 3
Total cost of good = 2
Buy 2 product at $ 3
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