Table 14-18
Tommy's Tie Company,a monopolist,has the following cost and revenue information.Assume that Tommy's is able to engage in perfect price discrimination.

-Refer to Table 14-18.If the monopolist can engage in perfect price discrimination,what is the total revenue when 3 ties are sold?

Question

Table 14-18
Tommy's Tie Company,a monopolist,has the following cost and revenue information.Assume that Tommy's is able to engage in perfect price discrimination.
 
-Refer to Table 14-18.If the monopolist can engage in perfect price discrimination,what is the total revenue when 3 ties are sold?

Quizplus · Accepted Answer

Under perfect price discrimination, the monopolist charges each customer the maximum price they are willing to pay, which is equal to the customer's marginal revenue (MR).

For the first unit, MR = $60, so the price charged will be $60. 
For the second unit, MR = $50, so the price charged will be $50. 
For the third unit, MR = $40, so the price charged will be $40.

Thus, the total revenue from selling 3 ties is:

($60 + $50 + $40) = $150 per tie x 3 ties = $450

Table 14-18 Tommy's Tie Company,a Monopolist,has the Following Cost and Revenue Information.Assume