Use the figure below to answer the following questions. Figure 12.4.6
-Prime Pharmaceuticals has developed a new asthma medicine,for which it has a patent.An inhaler can be produced at a constant marginal cost of $2 per inhaler.The demand curve,marginal revenue curve,and marginal cost curve for this new asthma inhaler are shown in Figure 12.4.6.The patent gives Prime Pharmaceuticals a monopoly for its new inhaler.If Prime Pharmaceuticals can perfectly price discriminate,then consumer surplus is
A)zero.
B)$24 million.
C)$64 million.
D)$44 million.
E)$32 million.

Question

Use the figure below to answer the following questions.  Figure 12.4.6
-Prime Pharmaceuticals has developed a new asthma medicine,for which it has a patent.An inhaler can be produced at a constant marginal cost of $2 per inhaler.The demand curve,marginal revenue curve,and marginal cost curve for this new asthma inhaler are shown in Figure 12.4.6.The patent gives Prime Pharmaceuticals a monopoly for its new inhaler.If Prime Pharmaceuticals can perfectly price discriminate,then consumer surplus is
A)zero. 
B)$24 million. 
C)$64 million. 
D)$44 million. 
E)$32 million.

Quizplus · Accepted Answer

When a monopolist can perfectly price discriminate, it charges each consumer the maximum they are willing to pay, thus capturing all the consumer surplus for itself. Therefore, consumer surplus is zero.

Use the Figure Below to Answer the Following Questions