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Economics

Heterogeneous consumers. A monopolist offers a single price to two consumers with the following demand functions: p1(q1) = 120 − q1 p2(q2) = 45 − 1 2 q2. The firm experiences a constant marginal cost of production, c = 10.

a) Graph aggregate demand, marginal revenue and marginal cost on a single graph

b) Find the optimal price and resulting demands of consumers 1 and 2 (P ∗ , q∗ 1 and q ∗ 2 )

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Business Economics, Economics

Category:- Business Economics
Reference No.:- M91401359

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