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A monopolist faces two consumer groups - old and young

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Subject: Economics
Due on: 11/07/2017
Posted On: 11/07/2017 10:28 AM

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A monopolist faces two consumer groups: old and young. The inverse demand of old clients for the output of the monopolist is Po=100-2Qo. This implies that MRo=100-4Qo. The inverse demand of young clients for the output of the monopolist is Py=80-Qy. This implies that MRy=80-2Qy. The marginal cost of supplying any type of client is MC=10. If the monopolist can price discriminate between the two groups (i.e., charge a different uniform price to each group), what price will old and young clients be charged?



Tags young groups consumer faces monopolist monopolist price clients young implies demand output groups inverse discriminate charged mc10 group different client uniform charge mry802qy po1002qo consumer faces mro1004qo py80qy supplying cost marginal type

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