Suppose That Verizon Wireless Has Hired You as a Consultant

question 60

Multiple Choice

Suppose that Verizon Wireless has hired you as a consultant to determine what price it should set for calling services.Suppose that an individual's inverse demand for wireless services in the greater Boston area is estimated to be P = 100 − 33Q and the marginal cost of providing wireless services to the area is $1 per minute.Compute consumer surplus when Verizon Wireless charges an optimal two-part price.

• A) $0
• B) $74.25
• C) $148.50
• D) There is insufficient information to compute consumer surplus.