Formulate the problem as an lc problem

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Reference no: EM131483864

Question: Compare the structure of the pure and of the perfectly discriminating monopolists as described in exercises I and II, where, however, matrices D are symmetric positive semidefinite. Does it mean that a pure monopolist makes twice as much profit as a perfectly discriminating monopolist? Explain thoroughly.

Exercises I: Develop the programming model of a pure monopolist facing three or more inverse demand functions given by vector p = c - Dx, where D is an asymmetric positive semidefinite matrix of price/quantity slopes, and a linear technology Ax ≤ b, x ≥ 0.

(a) Can this problem be set up as dual pair of optimization models? Explain thoroughly.

(b) Formulate the problem as an LC problem.

Exercises II: Develop the programming model of a perfectly discriminating monopolist facing three or more inverse demand functions p = c - Dx, where D is an asymmetric positive semidefinite matrix of price/quantity slopes, and a linear technology Ax ≤ b, x ≥ 0.

(a) Can this problem be set up as dual pair of optimization models? Explain thoroughly.

(b) Formulate the problem as an LC problem.

Reference no: EM131483864

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