Calculating equilibrium price and quantity for a monopolist.
A Monopolist is deciding how to allocate output among two markets. The two markets are separated geographically. Demand and marginal revenue for the two markets are given by:
P1 = 50- Q1
P2 = 25 - 0.5Q2
The monopolist's can serve both markets at a constant marginal cost of $10.00
Illustrate what are price, output, profits marginal revenue and deadweight loss (in each market) if the monopolist can price discriminate?