Study Guide for Microeconomics
9th Edition
ISBN: 9780134741123
Author: Robert Pindyck, Daniel Rubinfeld
Publisher: PEARSON
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Question
Chapter 11, Problem 8RQ
To determine
The determination of two-part tariff with two consumers with two different demand curves.
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Suppose the monthly demand for golf services at a golf club is given by the inverse demand function, P = 20 – Q. The marginal cost to the golf club for each round is €2. There are 10 customers with exactly the same inverse demand functions. The fixed costs of running the club are €500 a month. At the moment the golf club charges each person €11 per round and each person plays 9 rounds of golf a week.
The unit price that the club should charge each player under an optimal two-part tariff is
4
2
162
11
The demand function for a certain brand of CD is given by
p = -0.01x^2 - 0.2x +10
where p is the unit price in dollars and x stands for the quantity that will be made available in the market by the supplier, measured in units of a thousand. Determiine the producer's surplus if the market price is set at the equilibrium price. (round answer to neareset dollar)
P = 0.01x^2 + 0.4x +2
Suppose Verizon has only three cell phone customers. The demand curve for each customer’s monthly demand (in hours) is shown here: Here p = price in dollars charged for each hour of cell phone usage. It costs Verizon 25 cents to provide each hour of cell phone usage. a. If Verizon charges the same price for each hour of cell phone usage, what price should they charge? b. Find the profit maximizing a two-part tariff for Verizon. How much does the best two-part tariff increase the profit over the profit maximizing the single price?
Chapter 11 Solutions
Study Guide for Microeconomics
Ch. 11.A - Prob. 3ECh. 11 - Prob. 1RQCh. 11 - Prob. 2RQCh. 11 - Prob. 3RQCh. 11 - Prob. 4RQCh. 11 - Prob. 5RQCh. 11 - Prob. 6RQCh. 11 - Prob. 7RQCh. 11 - Prob. 8RQCh. 11 - Prob. 9RQ
Ch. 11 - Prob. 10RQCh. 11 - Prob. 11RQCh. 11 - Prob. 12RQCh. 11 - Prob. 13RQCh. 11 - Prob. 14RQCh. 11 - Prob. 15RQCh. 11 - Prob. 1ECh. 11 - Prob. 2ECh. 11 - Prob. 3ECh. 11 - Prob. 4ECh. 11 - Prob. 5ECh. 11 - Prob. 6ECh. 11 - Prob. 7ECh. 11 - Prob. 8ECh. 11 - Prob. 9ECh. 11 - Prob. 10ECh. 11 - Prob. 11ECh. 11 - Prob. 12ECh. 11 - Prob. 13ECh. 11 - Prob. 14ECh. 11 - Prob. 15ECh. 11 - Prob. 16ECh. 11 - Prob. 17E
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