Explore BrainMass
Share

Price Ceilings/Discrimination

This content was STOLEN from BrainMass.com - View the original, and get the solution, here!

1. Consider a price ceiling imposed on a monopoly that is set below the competitive price. Design a diagram showing the monopoly equilibrium in this case. Use your diagram to show that a price ceiling set this low will create a shortage.

2. What conditions must hold for a firm to be able to practice price discrimination? How are consumers affected by price discrimination? Elaborate about how consumers are affected.

© BrainMass Inc. brainmass.com September 21, 2018, 7:54 am ad1c9bdddf - https://brainmass.com/economics/general-equilibrium/price-ceilings-discrimination-45067

Solution Summary

Price Ceilings/Discrimination are highlighted.

$2.19