3. You are an internet service provider and you have two types of customers, households and businesses. Business demand for your service isqb = 6500 – 100p, and household demand is q, = 12500 – 500p. Your marginal cost is MC( + qh) = 20/3 + (g + Ih)/150. Calculate theprofit maximising prices you should charge the two goups under market segmentation (ie. third degree price discrimination).

3. You are an internet service provider and you have two types of customers, households and businesses. Business demand for your service is Ab = 6500– 100p, and household demand is qh = 12500 – 500p. Your marginal cost is MC(q + qh) = 20/3 + ( + qn)/150. Calculate the profit maximising prices you should charge the two goups under market segmentation (ie. third degree price discrimination).

3. You are an internet service provider and you have two types of customers, households and businesses. Business demand for your service is Ab = 6500– 100p, and household demand is qh = 12500 – 500p. Your marginal cost is MC(q + qh) = 20/3 + ( + qn)/150. Calculate the profit maximising prices you should charge the two goups under market segmentation (ie. third degree price discrimination).

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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