Use the following to answer questions (1)-(6): Suppose a monopolist sells a product to consumers for which a particular consumer's choice is whether to buy 1 unit of the product or not to buy the product. In the absence of price discrimination, the market demand for the monopolist's product is: Q-150-%P. Further, the firm's short-run total cost is: TC-1000+ 1000. Now, knowing each consumer's reservation price, imagine the monopolist wishes to engage in first-degree price discrimination. [1] A particular consumer's reservation price corresponds to the maximum amount they a willing to pay to buy 1 unit of the product.
Use the following to answer questions (1)-(6): Suppose a monopolist sells a product to consumers for which a particular consumer's choice is whether to buy 1 unit of the product or not to buy the product. In the absence of price discrimination, the market demand for the monopolist's product is: Q-150-%P. Further, the firm's short-run total cost is: TC-1000+ 1000. Now, knowing each consumer's reservation price, imagine the monopolist wishes to engage in first-degree price discrimination. [1] A particular consumer's reservation price corresponds to the maximum amount they a willing to pay to buy 1 unit of the product.
Chapter14: Monopoly
Section: Chapter Questions
Problem 14.2P
Related questions
Question
can you please answer 4 to 6
![Use the following to answer questions (1)-(6): Suppose a monopolist sells a product to consumers for which
a particular consumer's choice is whether to buy 1 unit of the product or not to buy the product. In the
absence of price discrimination, the market demand for the monopolist's product is: Q-150-%P. Further,
the firm's short-run total cost is: TC-1000 + 100Q. Now, knowing each consumer's reservation price,
imagine the monopolist wishes to engage in first-degree price discrimination.
[1] A particular consumer's reservation price corresponds to the maximum amount they a willing to pay
to buy 1 unit of the product.
A.
B.
[2] Wishing to maximize profit from first-degree price discrimination, the monopolist should sell a
quantity equal to:
A. 50
B.
75
C.
100
D.
None of the above
[3] Continuing question (2), at the quantity chosen the consumer willing to pay the least for the product
has a reservation price exceeding $50.
A.
B.
[4]
A.
B.
C.
D.
[5]
True
False
A.
B.
C.
D.
[6]
A.
B.
True
False
Wishing to maximize profit from first-degree price discrimination, the maximum profit possible is:
$20,000
$10,000
$9,000
$4,000
Wishing to maximize profit from first-degree price discrimination, consumer surplus is:
$10,000
$2,500
$1,200
SO
Wishing to maximize profit from first-degree price discrimination, producer surplus exceeds $5,000.
True
False](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Faaddc3fc-ec97-4ca6-aaae-bb996b719b45%2Fbedfd424-ca2b-4440-a08c-80c306f99951%2Fe21l8vk.jpeg&w=3840&q=75)
Transcribed Image Text:Use the following to answer questions (1)-(6): Suppose a monopolist sells a product to consumers for which
a particular consumer's choice is whether to buy 1 unit of the product or not to buy the product. In the
absence of price discrimination, the market demand for the monopolist's product is: Q-150-%P. Further,
the firm's short-run total cost is: TC-1000 + 100Q. Now, knowing each consumer's reservation price,
imagine the monopolist wishes to engage in first-degree price discrimination.
[1] A particular consumer's reservation price corresponds to the maximum amount they a willing to pay
to buy 1 unit of the product.
A.
B.
[2] Wishing to maximize profit from first-degree price discrimination, the monopolist should sell a
quantity equal to:
A. 50
B.
75
C.
100
D.
None of the above
[3] Continuing question (2), at the quantity chosen the consumer willing to pay the least for the product
has a reservation price exceeding $50.
A.
B.
[4]
A.
B.
C.
D.
[5]
True
False
A.
B.
C.
D.
[6]
A.
B.
True
False
Wishing to maximize profit from first-degree price discrimination, the maximum profit possible is:
$20,000
$10,000
$9,000
$4,000
Wishing to maximize profit from first-degree price discrimination, consumer surplus is:
$10,000
$2,500
$1,200
SO
Wishing to maximize profit from first-degree price discrimination, producer surplus exceeds $5,000.
True
False
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Essentials of Economics (MindTap Course List)
Economics
ISBN:
9781337091992
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Essentials of Economics (MindTap Course List)
Economics
ISBN:
9781337091992
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Microeconomics (MindTap Course List)
Economics
ISBN:
9781305971493
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Economics, 7th Edition (MindTap Cou…
Economics
ISBN:
9781285165875
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Microeconomics
Economics
ISBN:
9781305156050
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning