Business, 27.06.2020 23:01 mcmccann4317

A monopoly firm faces two markets where the inverse demand curves are: Market A: P_A = 140 - 2.75Q_A.

Market B: P_B = 120 - Q_B.

The firm operates a single plant where total cost is C = 20Q + 0.25Q^2, and mammal cost is m = 20 + 0.5Q.

Required:

1. Suppose the firm sets a single price for both markets. Using the information above, the profit maximizing price is $86.18 and the profit maximizing quantity is 53.37 units. Given this information, you determine that the firm will earn a profit of $ .

2. Now suppose the firm is able to engage in group price discrimination. To maximize profits, the firm will produce 16.95 units for market A and charge customers in market A a price of $ 93.39 per unit. And it will produce 36.6 units for market B and change customers in market B a price of $ per unit.

3. If the firm engages in your price discrimination it will earn a profit of $ .

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A monopoly firm faces two markets where the inverse demand curves are: Market A: P_A = 140 - 2.75Q_...

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