The diagram below shows a pharmaceutical firm's demand curve and marginal cost curve for a new heart medication for which the firm holds a 20- year patent on its production.
FIGURE 10- 5
-Refer to Figure 10- 5. Assume this pharmaceutical firm is practicing perfect price discrimination among its buyers. At its profit- maximizing level of output, consumer surplus is represented by
A) areas C+F+H.
B) areas D+E.
C) - there is no consumer surplus.
D) areas C+D+E+F+H.
E) - it is not possible to determine with the information provided.
Correct Answer:
Verified
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