Question: 7 . A monopolist is operating in two separate markets. The inverse demand functions for the two markets are P 1 = 1 8 2

7. A monopolist is operating in two separate markets. The inverse demand functions for the two markets are P1=182Q1 and P2=12 Q2. The monopolists total cost function is TC(Q)=8+4(Q1+ Q2). The monopolist can price discriminate. What kind of price discrimination is relevant here? What is the profit-maximizing price in each market? What is the monopolists profit? 8. Suppose that the monopolist from Question 7 is now forced to charge the same price in both markets. How much profit does the monopoly stand to lose?

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