Solved

A Third-Degree Price Discriminating Monopolist Can Sell Its Output Either

Question 26

Multiple Choice

A third-degree price discriminating monopolist can sell its output either in the local market or on an internet auction site (or both) . After selling all of its output, the firm discovers that the marginal revenue earned in the local market was $20 while its marginal revenue on the internet auction site was $30. To maximize profits the firm should:


A) have sold more output in the local market and less at the internet auction site.
B) do nothing until it acquires more information on costs.
C) have sold less output in the local market and more on the internet auction site.
D) sell less in both markets until marginal revenue is zero.
E) sell more in both markets until marginal cost is zero.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents