Monopolist perfectly discriminate price


Problem: Suppose a monopolist sells its good to three people. Each person can only purchase one good. The first person is willing to pay $20 for the good, the second person is willing to pay $18, and the third is willing to pay $16. If these three people make up the entire market for this monopolist, the monopolist would face the demand curve shown in the table at right.

Buyer Price
1 $20
2 $18
3 $16

Question 1: If a monopolist can perfectly price discriminate, how much total revenue will it receive if it sells all three units?

Question 2: If the monopolist cannot price discriminate and has to charge the same price on all units sold, how much total revenue will it receive if it sells three units?

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Microeconomics: Monopolist perfectly discriminate price
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