A monopolist has two specific demanders with demand


A monopolist has two specific demanders with demand equations: qA = 10 – p and qB = 10 – 2p. This monopolist implements an optimal two-part tariff pricing scheme, under which demanders pay a fixed fee a for the right to consume the good and a uniform price p for each unit consumed. The monopolist chooses a andp to maximize profits. This monopolist produces at constant average and marginal costs of AC = MC = 2. The monopolist’s profits are _____ and the average price paid by demander B is _______ . (NOTE: Write your first answer in number format, with 2 decimal places of precision level; do not write your answer as a fraction. Use a period for the decimal separator and a comma to separate groups of thousands). Show all steps.

Request for Solution File

Ask an Expert for Answer!!
Business Economics: A monopolist has two specific demanders with demand
Reference No:- TGS01473908

Expected delivery within 24 Hours