How many units will the consumer buy in total

Assignment Help Econometrics
Reference no: EM13187600

Discounting is examined.

Suppose that individual demand for a product is given by QD=1000-5P. Marginal revenue is MR=200-0.4Q, and marginal cost is constant at $20. There are no fixed costs.

a) The firm is considering a quantity discount. The first 400 units can be purchased at a price of $120, and further units can be purchased at a price of $80. How many units will the consumer buy in total?

b) Show that this second-degree price-discrimination scheme is more profitable than a single monopoly price.

Reference no: EM13187600

Questions Cloud

How many of each type of vessel should be used : How many of each type of vessel should be used in order to keep the operating costs to a minimum?
Compute the amount of n gas released : Calculate the amount of n2 gas released(in liters) when the diver returns to the surface of the water where the partial pressure of N2 is 0.80 atm
Which of the two systems you think does the best job : Choose two of the following economic systems(traditional,free market,or centrally planned) and explain which of the two systems you think does the best job of achieving each goal of the major economic goals each economic system tries to meet
What mileage will aloow you to stay within your budget : A car rents for $37 per day plus 20cent per mile. You are on a daily budget of $95. What mileage will aloow you to stay within your budget?
How many units will the consumer buy in total : Discounting is examined. Suppose that individual demand for a product is given by QD=1000-5P. Marginal revenue is MR=200-0.4Q, and marginal cost is constant at $20. There are no fixed costs. a) The firm is considering a quantity discount. The firs..
Compute the percent relative error molarities : Calculate the percent relative error for the three solutions if perfect technique is used. Report the two new molarities. (The error in a 10-mL transfer pipet is 0.02, and the error in the 200-mL volumetric flask is 0.1)
Determine the own advertising elasticity of demand : Suppose the demand function for a firm's product is given by In Qdx=3-0.5 In Px-2.5 In Py In M 2 In A Where Px= $10, Py= $4, M= $20,000, A= $250 A. Determine the own price elasticity of demand, and state whether demand is elastic, inelastic, or unita..
What was the value of his ira at the end of 7 years : What was the value of his IRA at the end of 7 years?
Saturated liquid while the pressure is maintained constant : Five kg of water initially a saturated vapor at 100kPa are cooled to saturated liquid while the pressure is maintained constant. Sketch the process on a p-v diagram

Reviews

Write a Review

Econometrics Questions & Answers

  What price should the company charge for a pair of shoes

Suppose that the marginal cost faced by a shoe company is $10 for a pair of shoes. If the demand elasticity for the company's shoes is also constant, and is equal to 5, what price should the company charge for a pair of shoes

  Lnrgdpaus and briefly comment on the graphs

Plot the level and first difference of lnrgdpaus and briefly comment on the graphs and obtain the sample correlograms of the level and first difference of lnrgdpaus for 20 lags. What do they suggest to you?

  What is the maximum fixed amount of withdrawal

Mr. Jones has deposited his life savings of $70,000 in a retirement income plan with a local bank. The bank pays a. 10%, b. 11.25%, per year, compounded annually, on such deposits.

  What is the minimum internal rate of return

company is currently considering the following possible projects (which are NOT mutually exclusive). You have a budget limitation of $400,000. What is the minimum internal rate of return that a NEW project (in addition to these) would need to ea..

  What should your pricing policy be to maximize profits

You are the manager of a pizza parlor that produces at a marginal cost of $6 per pizza. The parlor is a local monopoly near campus (there are no other restaurants or food stores within 50 miles). During the day, only students eat at your restauran..

  Interpreting regression results

How do you interpret the effect of immigrant status on wages when the model is Log wages regressed on immigrant dummy, and an immigrant dummy interaction

  Explanation of yield curve

The following statement was released through FOMC following recent meeting on March 21. The Group, although hopeful for a future of moderate growth with moderating inflation,

  What is the optimal output for the production division

The Xerxes Company is composed of a marketing division and a production division. The marketing division packages and distributes a plastic item made by the production division. The demand curve for he finished product sold by the marketing divisi..

  Determine the price of sugar rises

Suppose that the market for candy canes operates under conditions of perfect competition, that it is initially in long-run equilibrium, and that the price of each candy cane is $0.10. Now suppose that the price of sugar rises, increasing the margi..

  Derive the intertemporal euler equation

Derive the intertemporal Euler equation and what is the optimal level of C1 given the endowments, R, and ? What?s theoptimal level of C2?

  Advantage of the production function

A major advantage of production function is that it can be easily transformed into a linear function, and thus can be analyzed with the linear regression method.

  Estimate potential sales of employer product

Suppose you have been employed as an economic analyst, your job is to use the Regression Model to estimate potential sales of your employer's product.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd