« previous next »

Author Question: Bob is the only carpet installer in a small isolated town. The above figure shows the demand curves ... (Read 142 times)

Bob-Dole

  • Hero Member
  • *****
  • Posts: 547
on: Jul 1, 2018
Bob is the only carpet installer in a small isolated town. The above figure shows the demand curves of two distinct groups of customers-residential and business. If the marginal cost of installing carpet is a constant 1 per sq yard, what price does Bob charge each segment?
 
  What will be an ideal response?

Question 2

While price discrimination is possible between two markets, it is not possible in more than two.
 
  Indicate whether the statement is true or false
Microeconomics ¦ Perloff ¦ 8th Edition
Buy Test-Bank


jaygar71

  • Sr. Member
  • ****
  • Posts: 323
Reply #1 on: Jul 1, 2018
Answer to Question 1

Setting MR = 1 in both markets yields a price of 5.50 in the residential market and 8 in the business market.

Answer to Question 2

False. The number of markets does not matter. All that is required is that markets differ in their respective price elasticity of demand.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

In Eastern Europe and Russia, interferon is administered intranasally in varied doses for the common cold and influenza. It is claimed that this treatment can lower the risk of infection by as much as 60–70%.

Did you know?

The cure for trichomoniasis is easy as long as the patient does not drink alcoholic beverages for 24 hours. Just a single dose of medication is needed to rid the body of the disease. However, without proper precautions, an individual may contract the disease repeatedly. In fact, most people develop trichomoniasis again within three months of their last treatment.

Did you know?

Excessive alcohol use costs the country approximately $235 billion every year.

Did you know?

According to animal studies, the typical American diet is damaging to the liver and may result in allergies, low energy, digestive problems, and a lack of ability to detoxify harmful substances.

Did you know?

Cocaine was isolated in 1860 and first used as a local anesthetic in 1884. Its first clinical use was by Sigmund Freud to wean a patient from morphine addiction. The fictional character Sherlock Holmes was supposed to be addicted to cocaine by injection.

Hyperopia (farsightedness). In the uncorrected top figure, the image would come into focus behind th Hyperopia (farsightedness). In the uncorrected top figure, the image would come into focus behind th
A demand delivery system uses a fuel-pressure regulator attached to the fuel pump assembly inside ... A demand delivery system uses a fuel-pressure regulator attached to the fuel pump assembly inside ...
Increased neurogenesis in the dentate gyrus following damage. The left panel shows (1) an ... Increased neurogenesis in the dentate gyrus following damage. The left panel shows (1) an ...
Arctic Ocean was isolated Arctic Ocean was isolated
The original Supply and Demand graph The original Supply and Demand graph
Construct a Lorenz curve that shows income distribution in this society. Construct a Lorenz curve that shows income distribution in this society.
Video: Types of Shock (Part 2 of 2)

For a complete list of videos, visit our video library