What is the lowest price the eye doctor will charge

Assignment Help Econometrics

Reference no: EM13219265

In the town of Woodland, California, there are many dentists but only one eye doctor. The market demand curve for eye exams is P = 115 - 2Q, marginal revenue is MR = 115 - 4Q and the marginal cost for an eye exam is constantly $35.

(a) Suppose that the eye doctor charges a single price for all patients. What is the price the eye doctor will charge to maximize profit? And how many eye exams will the eye doctor do?

(b) What is the eye doctor's producer surplus in part (a)? And what is the consumer surplus? Is there any deadweight loss?

(c) Suppose that the eye doctor practices perfect, first-degree price discrimination. What is the lowest price the eye doctor will charge? And how many eye exams will the eye doctor do?

(d) What is the eye doctor's producer surplus in part (c)? And what is the consumer surplus? Is there any deadweight loss?

Reference no: EM13219265

Questions Cloud

Calculate the price elasticity of demand for each group : Suppose that the eye doctor offers senior residents a discounted price for an eye exam. The demand function for senior residents is Qs = 50 - Ps, and the demand function for the general public is Qg = 60 - Pg. The marginal cost for an eye exam is ..

Native reasoning abilities-inductive reasoning : Solve the following mini-mysteries on your own using your own native reasoning abilities, and then based on what you have learned, explain how you know deductive rather than inductive reasoning is used in each case.

Find the displacement s of the piston : one question: During each cycle, the velocity v (in mm/s) of a piston is v = 6t - 6t^2, where t is the time (in sec). Find the displacement s of the piston after 0.75 sec if the initial displacement is zero.

What memory modules are needed : What memory modules are needed if the customer wants 1.25GB of RAM?(What capacities and how many of each capacity?)

What is the lowest price the eye doctor will charge : In the town of Woodland, California, there are many dentists but only one eye doctor. The market demand curve for eye exams is P = 115 - 2Q, marginal revenue is MR = 115 - 4Q and the marginal cost for an eye exam is constantly $35.

Explain a parallel-plate capacitor with air dielectric : A parallel-plate capacitor with air dielectric has a plate area of 75cm^2. if the capacitor is fully charged by a 300-v source and can hold a charge of 7.5x10^-9c, what is the distance between the plates

Determine the magnitude of the current : Determine the magnitude of the current when the machine develops its maximum gross power with the excitation held constant.

Create an incident and command response structure : Identify specific personnel or positions for each function and provide scenario based training - Create an incident and command response structure for all emergency or public service agencies in California, such as police, fire, medical, and so for..

Description of boundary conditions for shear stress-velocity : Derivation for flow over a falling film with complete description of boundary conditions for shear stress,velocity, average velocity, mass flow rate,maximum velocity and forces acting

User Account

All Pages