college/microeconomics
posted by Lorie on .
The following table indicates the prices various buyers are willing to pay for a Miata sports car:
Buyer A Maximum price $50,000
Buyer B Maximum price $40,000
Buyer C Maximum price $30,000
Buyer D Maximum price $20,000
Buyer E Maximum price $10,000
The cost of producing the cars includes $50,000 of fixed costs and a constant marginal cost of $10,000. With a Quantity between 0 and 6 cars per period.
a) graph the demand, marginal revenue, and marginal cost curves.
b) What is the profitmaximizing rate of output and price for the monopolist? How much profit does the monopolist make?
Output____________
Price_____________
Profit____________
c) If the monopolist can pricediscriminate, how many cars will he sell?
d) How much profit will he make?

First, derive a marginal revenue curve (like you did in your previous post.) So,
P=50000, Q=1, TR=50000, MR=50000
P=40000, Q=2, TR=80000, MR=30000
P=30000, Q=3, TR=90000, MR=10000
and so on.
b) he makes 3 cars, charges 30,000 each, and makes 10,000 profit.
c) He makes 5 cars, charges the maximum each buyer will pay TR=150,000 ... 
fdc