A Price-Discriminating Monopolist Sells in Two Separate Markets Such That

question 10

Multiple Choice

A price-discriminating monopolist sells in two separate markets such that goods sold in one market are never resold in the other. It charges $6 in one market and $8 in the other market. At these prices, the price elasticity in the first market is -2.10 and the price elasticity in the second market is -0.40. Which of the following actions is sure to raise the monopolist's profits?

• A) Raise both p₁ and p₂.
• B) Raise p₂.
• C) Lower p₂.
• D) Raise p₁ and lower p₂.
• E) Raise p₂ and lower p₁.

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Definitions:

Public Image

The perception of an organization or individual by the general public, influenced by media, communication strategies, and actions.

Investment Plans

Financial strategies designed to allocate resources towards future profit and growth opportunities.

Shackleton's Leadership

Refers to the leadership style and practices of Ernest Shackleton, especially during his Antarctic expeditions, which are noted for his exceptional crisis management and ability to maintain crew morale under extreme conditions.