Suppose a firm faces an identical inverse demand curve of p = 110- q for each consumer in the market. Currently, the firm's average cost = marginal cost = $20. Determine the profit-maximizing price and identical lump-sum fee to charge with a two-part tariff. The profit-maximizing price to charge is $. (Enter a numeric response using a real number rounded to two decimal places.) The profit-maximizing lump-sup fee to charge is $. (Enter a numeric response rounded to the nearest dol ar.)

Suppose a firm faces an identical inverse demand curve of p = 110- q for each consumer in the market. Currently, the firm's average cost = marginal cost = $20. Determine the profit-maximizing price and identical lump-sum fee to charge with a two-part tariff. The profit-maximizing price to charge is $. (Enter a numeric response using a real number rounded to two decimal places.) The profit-maximizing lump-sup fee to charge is $. (Enter a numeric response rounded to the nearest dol ar.)

Macroeconomics

13th Edition

ISBN:9781337617390

Author:Roger A. Arnold

Publisher:Roger A. Arnold

Chapter5: Supply, Demand, And Price: Applications

Section5.7: Application 7: Why Do Colleges Use Gpa,s Actss, And Sats, For Purposes Of Admission?

Problem 2ST

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