A Profit-Maximizing Monopolist Faces a Downward-Sloping Demand Curve That Has

question 27

Multiple Choice

A profit-maximizing monopolist faces a downward-sloping demand curve that has a constant elasticity of -4.The firm finds it optimal to charge a price of $24 for its output.What is its marginal cost at this level of output?

• A)$55
• B)$18
• C)$48
• D)$10
• E)$24

Distinguish between direct and indirect price discrimination.

Analyze the impact of price discrimination on consumer and producer surplus.

Recognize the role of elasticity of demand in price discrimination strategies.

Understand legal considerations related to price discrimination, focusing on the Robinson-Patman Act.

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