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Economics

Q1. A company currently sells 60,00 units a month at $10 every unit. The variable cost every unit is $6. The company decided to raise the price about 10%. Explain how much change in the number of units sold can the company afford and still be no worse off?

Q2. You are the manager of a monopoly. A typical customer's inverse demand function for your firm's product is P = 100 - 20Q and your cost function is C(Q) = 20Q.

a. Determine the optimal two-part pricing strategy.

b. Explain how much additional profit do you earn using a two-part pricing strategy compared with charging this customer a every-unit price?

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M9168282

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