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    first degree price discrimination

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    Two consumers, Consumer 1 and Consumer 2, purchase the same product.
    They have the following demand curves:

    Q1 = 500 - 10 P and
    Q2 = 500 - 20 P.

    MC for the firm is $10.

    (a) Calculate the prices that should be charged to each
    customer if the seller is able to use first degree price discrimination.
    (b) Is this a good strategy, or should the firm charge the same price to both customers?

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    https://brainmass.com/economics/macroeconomics/first-degree-price-discrimination-248048

    Solution Preview

    Two consumers, Consumer 1 and Consumer 2, purchase the same product.
    They have the following demand curves:

    Q1 = 500 - 10 P and
    Q2 = 500 - 20 P.

    MC for the firm is $10.

    (a) Calculate the prices ...

    Solution Summary

    This post examines first degree price discrimination.

    $2.19