A monopoly is considering selling several units of a homogeneous product as a single package. A typical consumer's demand for the product is Q = 80-0.5P, and the marginal cost of production is $ 100. a)     Determine the optimal number of units to put in a package. b)     How much should the firm charge for this package? c)     How much additional profit does the company earn compared with charging this consumer a per-unit price?

Survey Of Economics
10th Edition
ISBN:9781337111522
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter8: Monopoly
Section: Chapter Questions
Problem 4SQ
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A monopoly is considering selling several units of a homogeneous product as a single package. A typical consumer's demand for the product is Q = 80-0.5P, and the marginal cost of production is $ 100.

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

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

c)     How much additional profit does the company earn compared with charging this consumer a per-unit price?

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