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Suppose the demand functions facing a wireless telephone monopolist are Q£ = 80 – 200P for each low-demand consumer and Q% = 200 – 200P for each high-demand consumer, where PIs the per-minute price in dollars. The marginal cost is $0.15 per minute. Suppose the monopolist offers a menu of two-part tariff plans, with one plan Intended for each type of consumer. Suppose too that for any per- minute price P, In the low-demand plan, the fixed fee in the low-demand plan leaves a low-demand consumer with zero surplus; that the number of minutes in the low-demand plan is capped at the number of minutes desired by a low-demand consumer at that plan's per-minute price; and that the high-demand plan has a per-minute price of $0.15 per minute and a fixed fee that leaves the high- demand consumer approximately Indifferent between the low- and high-demand plans. Suppose that there are 100 high-demand consumers and 400 low-demand consumers. Will the monopolist's profit be higher when the per-minute price In the low-demand plan Is $0.20 or $0.25? Instructlons: Round your answers to 2 decimal places as needed. a. Suppose the monopolist's per-minute price In the low-demand plan Is S0.20. Profit = $ b. Now suppose the monopolist's per-minute price In the low-demand plan is $0.25. Profit = $

Suppose the demand functions facing a wireless telephone monopolist are Q£ = 80 – 200P for each low-demand consumer and Q% = 200 – 200P for each high-demand consumer, where PIs the per-minute price in dollars. The marginal cost is $0.15 per minute. Suppose the monopolist offers a menu of two-part tariff plans, with one plan Intended for each type of consumer. Suppose too that for any per- minute price P, In the low-demand plan, the fixed fee in the low-demand plan leaves a low-demand consumer with zero surplus; that the number of minutes in the low-demand plan is capped at the number of minutes desired by a low-demand consumer at that plan's per-minute price; and that the high-demand plan has a per-minute price of $0.15 per minute and a fixed fee that leaves the high- demand consumer approximately Indifferent between the low- and high-demand plans. Suppose that there are 100 high-demand consumers and 400 low-demand consumers. Will the monopolist's profit be higher when the per-minute price In the low-demand plan Is $0.20 or $0.25? Instructlons: Round your answers to 2 decimal places as needed. a. Suppose the monopolist's per-minute price In the low-demand plan Is S0.20. Profit = $ b. Now suppose the monopolist's per-minute price In the low-demand plan is $0.25. Profit = $

MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
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Suppose the demand functions facing a wireless telephone monopolist are Q£ = 80 – 200P for each low-demand consumer and Q% = 200 – 200P for each high-demand consumer, where PIs the per-minute price in dollars. The marginal cost is $0.15 per minute. Suppose the monopolist offers a menu of two-part tariff plans, with one plan Intended for each type of consumer. Suppose too that for any per- minute price P, In the low-demand plan, the fixed fee in the low-demand plan leaves a low-demand consumer with zero surplus; that the number of minutes in the low-demand plan is capped at the number of minutes desired by a low-demand consumer at that plan's per-minute price; and that the high-demand plan has a per-minute price of $0.15 per minute and a fixed fee that leaves the high- demand consumer approximately Indifferent between the low- and high-demand plans. Suppose that there are 100 high-demand consumers and 400 low-demand consumers. Will the monopolist's profit be higher when the per-minute price In the low-demand plan Is $0.20 or $0.25? Instructlons: Round your answers to 2 decimal places as needed. a. Suppose the monopolist's per-minute price In the low-demand plan Is S0.20. Profit = $ b. Now suppose the monopolist's per-minute price In the low-demand plan Is S0.25. Profit = $
Transcribed Image Text:Suppose the demand functions facing a wireless telephone monopolist are Q£ = 80 – 200P for each low-demand consumer and Q% = 200 – 200P for each high-demand consumer, where PIs the per-minute price in dollars. The marginal cost is $0.15 per minute. Suppose the monopolist offers a menu of two-part tariff plans, with one plan Intended for each type of consumer. Suppose too that for any per- minute price P, In the low-demand plan, the fixed fee in the low-demand plan leaves a low-demand consumer with zero surplus; that the number of minutes in the low-demand plan is capped at the number of minutes desired by a low-demand consumer at that plan's per-minute price; and that the high-demand plan has a per-minute price of $0.15 per minute and a fixed fee that leaves the high- demand consumer approximately Indifferent between the low- and high-demand plans. Suppose that there are 100 high-demand consumers and 400 low-demand consumers. Will the monopolist's profit be higher when the per-minute price In the low-demand plan Is $0.20 or $0.25? Instructlons: Round your answers to 2 decimal places as needed. a. Suppose the monopolist's per-minute price In the low-demand plan Is S0.20. Profit = $ b. Now suppose the monopolist's per-minute price In the low-demand plan Is S0.25. Profit = $
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