You operate a small microbrewery in Germany. The demand curve for cases of your beer is P = 50 - .002Q. Your marginal cost for producing beer is 10 euros per case. Currently you are charging all customers the same price for a case of your beer.
1. What are the optimal price, quantity, and profits under this pricing policy?
2. Calculate the surplus that goes to consumers.
3. Describe how you might capture additional profits using a more sophisticated pricing policy that does not involve capturing more of the consumer surplus. Explain.