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Business, 19.09.2020 01:01 alasiaca

Suppose this monopolist can price discriminate across its customers and sets 2 prices in the market. Let P M represent the standard (single price) monopoly price (or list price ) and Q M the standard monopoly quantity. Suppose the monopolist knows that customers with reservation prices less than P M will always use a coupon to receive a discount price P D , while customers with reservation prices greater than or equal to P M always pay the higher list price P M . This set-up is precisely the one we considered in class and in homework. The monopolist will choose a discount price of and sell units of the good in the discount market.

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Suppose this monopolist can price discriminate across its customers and sets 2 prices in the market....

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