Suppose a Monopolist Can Charge Different Prices to Different Customers

question 180

Essay

Suppose a monopolist can charge different prices to different customers, such as doctors charging different prices depending on whether the patient is insured.How will profits and marginal revenue of such a price-discriminating monopolist compare to profits and MR of an ordinary monopolist who must charge all patients the same fee?

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Definitions:

Proactive Aggression

Aggressive behavior that is premeditated and intended to achieve a specific goal, rather than being a response to an immediate threat.

Instrumental Aggression

Instrumental Aggression is a type of behavior aimed at achieving a certain goal or objective, rather than stemming from anger or emotion.

Displaced Aggression

Any behavior that intentionally harms a substitute target rather than the provocateur.

Indirect Aggression

Any behavior that intentionally harms another person who is physically absent.