Suppose a monopoly produces film and cameras.Consumers demand pictures,which require film and one camera.Two different types of consumers have the following demand for film,
q_A = 100 - 10p and q_B = 80 - 10p.The monopoly cannot price discriminate in the market for film or the market for cameras,but it can bundle the products.The monopoly produces film at a constant marginal cost of $1 per roll.What price will the monopoly set for film and for cameras?

Question

Quizplus · Accepted Answer

The Answer of Suppose a monopoly produces film and cameras.Consumers demand pictures,which require film and one camera.Two different types of consumers have the following demand for film, q_A = 100 - 10p and q_B = 80 - 10p.The monopoly cannot price discriminate in the market for film or the market for cameras,but it can bundle the products.The monopoly produces film at a constant marginal cost of $1 per roll.What price will the monopoly set for film and for cameras?

Suppose a Monopoly Produces Film and Cameras