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Based on the following graph (which summarizes the demand, marginal revenue, and relevant costs for your product), determine your firm's optimal price, output, and the resulting profits for each of the following scenarios: Price 110 100 90 80 70 60 50 40 30 20 10 MC = AC Quantity MR 0 1 2 3 4 5 6 7 8 9 101112131415 D a. You charge the same unit price to all consumers.

Based on the following graph (which summarizes the demand, marginal revenue, and relevant costs for your product), determine your firm's optimal price, output, and the resulting profits for each of the following scenarios: Price 110 100 90 80 70 60 50 40 30 20 10 MC = AC Quantity MR 0 1 2 3 4 5 6 7 8 9 101112131415 D a. You charge the same unit price to all consumers.

Microeconomics: Private and Public Choice (MindTap Course List)
Microeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter11: Price-searcher Markets With High Entry Barriers
Section: Chapter Questions
Problem 14CQ
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Based on the following graph (which summarizes the demand, marginal revenue, and relevant costs for your product), determine your firm's optimal price, output, and the resulting profits for each of the following scenarios: Price 110 100 90 80 70 60 50 40 30 20 10 MC = AC MR D 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Quantity a. You charge the same unit price to all consumers.
Transcribed Image Text:Based on the following graph (which summarizes the demand, marginal revenue, and relevant costs for your product), determine your firm's optimal price, output, and the resulting profits for each of the following scenarios: Price 110 100 90 80 70 60 50 40 30 20 10 MC = AC MR D 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Quantity a. You charge the same unit price to all consumers.
a. You charge the same unit price to all consumers. Price: $ Output: Profits: $ units b. You engage in first-degree price discrimination. Price and output: Charge the maximum price on the demand curve starting at $100 down to $40 for each infinitesimal unit up to 6 units. Charge the maximum price on the demand curve starting at $100 down to $60 for each infinitesimal unit up to 4 units. Charge the maximum price on the demand curve starting at $100 down to $20 for each infinitesimal unit up to 8 units. O Charge the maximum price on the demand curve starting at $100 down to $80 for each infinitesimal unit up to 2 units. Profits: $ c. You engage in two-part pricing. Fixed fee: $
Transcribed Image Text:a. You charge the same unit price to all consumers. Price: $ Output: Profits: $ units b. You engage in first-degree price discrimination. Price and output: Charge the maximum price on the demand curve starting at $100 down to $40 for each infinitesimal unit up to 6 units. Charge the maximum price on the demand curve starting at $100 down to $60 for each infinitesimal unit up to 4 units. Charge the maximum price on the demand curve starting at $100 down to $20 for each infinitesimal unit up to 8 units. O Charge the maximum price on the demand curve starting at $100 down to $80 for each infinitesimal unit up to 2 units. Profits: $ c. You engage in two-part pricing. Fixed fee: $
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