This topic contains a solution. Click here to go to the answer

Author Question: A firm has two customers with non-identical demands and a constant marginal cost of production. At ... (Read 67 times)

kaid0807

  • Hero Member
  • *****
  • Posts: 515
A firm has two customers with non-identical demands and a constant marginal cost of production. At any positive price, the consumer surplus values for the two customers are related as CS2  CS1 .
 
  What can we say about the optimal two-part tariff for the firm? A) The firm sets the price equal to MC and the optimal tariff is equal to CS2.
  B) The firm sets the price equal to MC and the optimal tariff is equal to CS1.
  C) The firm sets the price equal to MC and the optimal tariff is equal to zero.
  D) The optimal price is greater than MC and the optimal tariff is equal to CS1.

Question 2

Refer to Figure 9.4. If the government establishes a price floor of 40 and purchases the surplus, total consumer and producer surplus will be
 
  A) 15.
  B) 30 widgets.
  C) 1,050.
  D) 1,200.
  E) 1,350



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Melissahxx

  • Sr. Member
  • ****
  • Posts: 304
Answer to Question 1

D

Answer to Question 2

E




kaid0807

  • Member
  • Posts: 515
Reply 2 on: Jul 1, 2018
Thanks for the timely response, appreciate it


mohan

  • Member
  • Posts: 362
Reply 3 on: Yesterday
:D TYSM

 

Did you know?

About 3% of all pregnant women will give birth to twins, which is an increase in rate of nearly 60% since the early 1980s.

Did you know?

Though Candida and Aspergillus species are the most common fungal pathogens causing invasive fungal disease in the immunocompromised, infections due to previously uncommon hyaline and dematiaceous filamentous fungi are occurring more often today. Rare fungal infections, once accurately diagnosed, may require surgical debridement, immunotherapy, and newer antifungals used singly or in combination with older antifungals, on a case-by-case basis.

Did you know?

When taking monoamine oxidase inhibitors, people should avoid a variety of foods, which include alcoholic beverages, bean curd, broad (fava) bean pods, cheese, fish, ginseng, protein extracts, meat, sauerkraut, shrimp paste, soups, and yeast.

Did you know?

If you could remove all of your skin, it would weigh up to 5 pounds.

Did you know?

Street names for barbiturates include reds, red devils, yellow jackets, blue heavens, Christmas trees, and rainbows. They are commonly referred to as downers.

For a complete list of videos, visit our video library