(Answered) For each of the following questions explain you answer and

Economics

For each of the following questions, explain you answer and show your work. Make sure your answers are backed up by numbers.

1. Suppose that individual demand for a product is given by Q = 1200 - 5P. Marginal revenue is

MR = 200 - 0.4Q, and marginal cost is constant at $ 20. There are no fixed costs.

a. The firm is considering a quantity discount. The first 400 units can be purchased at a price of $120, and further units can be purchased at a price of $80. How many units will the consumer buy in total?

b. Show that this second- degree price- discrimination scheme is more profitable than a single monopoly price.

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