A monopoly is considering selling several units of a homogeneous product as a single package. Analysts at your firm have determined that a typical consumer’s demand for the product is Qd = 100 − 0.25P, and the marginal cost of production is $140.   a. Determine the optimal number of units to put in a package.   b. How much should the firm charge for this package?

Survey Of Economics
10th Edition
ISBN:9781337111522
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter8: Monopoly
Section: Chapter Questions
Problem 9SQP
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A monopoly is considering selling several units of a homogeneous product as a single package. Analysts at your firm have determined that a typical consumer’s demand for the product is Qd = 100 − 0.25P, and the marginal cost of production is $140.

 

a. Determine the optimal number of units to put in a package.

 

b. How much should the firm charge for this package?

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