(b) Name and explain the three conditions that must hold in order for a firm to be able to price discriminate. Identify what type of price discrimination each example is (i.e. (a) Give two examples of price discrimination. What price would it charge for the book? How much profit would it make at this price? 3. Suppose that the publisher was not profit-maximizing but was concerned with maximizing economic efficiency. If the author were paid $3 million instead of $2 million for the book, how would this affect the publisher’s decision regarding what price to charge? Explain. In your graph, shade in the deadweight loss. At what quantity do the marginal-revenue and marginal-cost curves cross? What does this signify? d.
Graph the marginal-revenue, marginal-cost and demand curves. How does marginal revenue compare to price? Explain. Show the profit-maximizing price and the amount of profit. Draw the demand, marginal-revenue, average-total-cost, and marginal-cost curves for a monopolist. These must be submitted in class (not via email unless you have permission). Directions: You should legibly handwrite or type the answers to the following questions on a separate sheet of paper.
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