A monopolist produces a product and sells to two types of buyers: A and B. The inverse demand functions for A and B are and , respectively. The monopolist's cost function is . The profit maximizing output of the monopolist for buyer B is ________.
1 markMicroeconomicsMonopoly and price discriminationThird-degree price discriminationModerateabout 2 min
IIT JAM 2025 Question 47: Monopoly and price discrimination
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A monopolist produces a product and sells to two types of buyers: A and B. The inverse demand functions for A and B are P=50-5Q and P=100-10Q, respectively. The monopolist's cost function is C=90+20Q. The profit maximizing output of the monopolist for buyer B is.
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What this question tests
This question is on Third-degree price discrimination, part of Monopoly and price discrimination in Microeconomics.
Charging different groups different prices, and how elasticities decide which group pays more.
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