Imagine there are two cities (City A and City R) and you are the only provider of ice cream sandwiches for both. Use this information to answer the following questions: 

Maximum Willingness to Pay (MWP) for Ice Cream Sandwiches City AMWP

City RMWP

Aladdin$16

Richard$15

Alan$12

Ramon$14

Alvin$10

Robert$13

Albert $8

Roger$11

Albus $6

Reginald $4 

Note: Unit cost is $7 for each ice cream sandwich. Because both cities are located quite far from each other, a company can charge different prices in each without fear of reselling. How much more would it earn in profit by charging two different prices compared to charging everyone only one price? 

$4 

$0 

$3 

$2 

$1  

Answer rating: 100% (QA)

Combined demand schedule Q P TR MR 1 16 16 16 2 15 30 14 3 ... View the full answer