A Monopolist Has Discovered That the Inverse Demand Function of a Person

question 11

Multiple Choice

A monopolist has discovered that the inverse demand function of a person with income M for the monopolist's product is p = .002M - q. The monopolist is able to observe the incomes of its consumers and to practice price discrimination according to income (second-degree price discrimination) . The monopolist has a total cost function, c(q) = 100q. The price it will charge a consumer depends on the consumer's income, M, according to the formula

• A) p = .001M + 50.
• B) p = .002M - 100.
• C) p = M².
• D) p = .01M² + 100.
• E) None of the above.

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Definitions:

SRY Gene

Located on the Y chromosome in males, this gene codes for a transcription factor that binds to regulatory DNA. At about 5 weeks gestation, it turns on genes that start the production of other proteins responsible for the development of gonads into testes.

Zygotes

The initial cell formed when a new organism is conceived, created by the fusion of sperm and egg cells.

XY Chromosome

The combination of chromosomes characterized as male in humans, where a Y chromosome inherited from the father pairs with an X chromosome from the mother.

Distinct Cliques

Social clusters within a community where members share common interests or backgrounds, and distinctly separate from other groups.