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Consider a monopolist facing the following demand and cost curves

Date: 30 Jan 2013 Group: Education Category: Exam Questions

Consider a monopolist facing the following demand and cost curves.
P = 50 - 2Q C = 25+10Q

(Hint: Total demand at any point P will be the summation of two quantities)
Suppose the firm is able to separate its customers in two distinct markets with the following demand functions.

P1 = 40 - 2.5Q1 P2 = 90 - 10Q2

From the above equation calculate the following:

i) Total demand
ii) Marginal Revenue
iii) Marginal Cost

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