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Total Revenue with Perfect Price Discrimination

Calculate the total revenue without price discrimination as well as with price discrimination, and put the data into the table below.

Price____Qd____TR____TR (with perfect price discrimination)
20______ 0_____ -- ____ --
18______12_____ ? ____ ?
14______18_____ ? ____ ?
10______26_____ ? ____ ?
7_______33_____ ? ____ ?

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Price____Qd____TR____TR (with perfect price discrimination)
20______ 0_____ -- ____ --
18______12____216 ___228
14______18____252 ___306
10______26____260 ___390
7_______33____221 ___435.5

Perfect competition is the act of charging different prices to different customers, above the equilibrium price. The objective is to get the highest possible total revenue. The rational behind this is based on the definition of demand: the price that ...

Solution Summary

Perfect price discrimination is the act of charging different prices to different customers to take advantage of demand condition in order to maximize total revenue. The solution calculates total revenue with this, with almost 300 words of explanation and a full example with a demand curve and equilibrium price attached.

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