Suppose that Cornell University faces a downward-sloping linear demand curve for the undergraduate education that it provides.

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“Suppose that Cornell University faces a downward-sloping linear demand curve for the undergraduate education that it provides. If Cornell is able to engage in perfect, first-degree price discrimination (through obtaining detailed financial information from each prospective student and offering different levels of financial aid), then Cornell’s marginal and average revenue curves will be identical.” Explain why this statement is true, false or uncertain.

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Microeconomics Theory and Applications

ISBN: 978-1118758878

12th edition

Authors: Edgar K. Browning, Mark A. Zupan

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