A monopolist is selling sneakers to students and non-students. The Marginal Cost of an extra pair of sneakers is $9. Student demand is given by Q=235-P and Non-student demand is given by Q=400-2P. Right now they act like a single-price monopolist for the entire market. If they decide to do group price-discrimination (assume they can) what will be the CHANGE in prices for students? Don't forget to include the negative sign if the price for student falls with group price-discrimination.
A monopolist is selling sneakers to students and non-students. The Marginal Cost of an extra pair of sneakers is $9. Student demand is given by Q=235-P and Non-student demand is given by Q=400-2P. Right now they act like a single-price monopolist for the entire market. If they decide to do group price-discrimination (assume they can) what will be the CHANGE in prices for students? Don't forget to include the negative sign if the price for student falls with group price-discrimination.
Chapter8: Monopoly
Section: Chapter Questions
Problem 7SQP
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