Question: Suppose a monopolist recognizes that students have a different demand schedule for their product than non-students. Specifically, inverse demand by students is given by: =
Suppose a monopolist recognizes that students have a different demand schedule for their product than non-students. Specifically, inverse demand by students is given by: = 50 ! , while inverse demand by the rest of society (G) is given by = 40 ". The monopolist's costs are given by = 5 + 50. If the monopolist were to attempt to 3rd degree price discriminate by selling to each group at a different price, what price would it charge students? What price would it charge the general public? Why wouldn't this work?
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