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Author Question: What is a better pricing strategy for the monopolist? At this price, what are the total profits to ... (Read 58 times)

littleanan

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on: Jul 1, 2018
What is a better pricing strategy for the monopolist? At this price, what are the total profits to the monopolist?
 a. Bundle the goods at 2,800 . Profits=5,600
  b. Bundle the goods at 4,000 . Profits=8,000
  c. Charge 2,800 for good 1 and charge 1,700 for good 2; Profits=4,500
  d. Charging the lowest price for each good individually is the best pricing strategy; profits = 7,000

Question 2

With only two goods, x and y, if x and y are gross substitutes, a rise in px must necessarily:
 a. increase spending in x.
  b. reduce spending in x.
  c. increase spending in y.
  d. reduce spending in y.


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xMRAZ

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Reply #1 on: Jul 1, 2018
Answer to Question 1

b

Answer to Question 2

c


littleanan

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Reply 2 on: Jul 1, 2018
Great answer, keep it coming :)

nyrave

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Reply 3 on: Yesterday
:D TYSM

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