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b ) A perfectly competitive external market for the intermediate product exists
c ) An imperfectly competitive external market for the intermediate product exists ?
Discussion Question 13 : What are : a ) The advantages of cost-plus pricing ? b ) The disadvantages of cost-plus pricing ?
c ) Why is incremental cost pricing the correct pricing method ? Why is full-cost pricing equal to it ?
Problem 5
The Dairy Farm Company , a small producer of milk and cheese , has estimated the quantities of milk and cheese that it can produce with three levels of total expenditures or total costs . These are indicated in the following table . If the price of milk ( product A ) and the price of cheese ( product B ) that the firm receives are $ 1 each per unit of the products , draw a figure showing the maximum total profi t ( p ) that the firm can earn at each level of TC and the overall maximum profit that the firm can earn for the three different levels of TC .
Problem 12 :
a ) Will a monopolist ’ s total revenue be larger with seconddegree price discrimination when the batches on which it charges a uniform price are larger or smaller ? Why ?
b ) A perfectly competitive external market for the intermediate product exists
c ) An imperfectly competitive external market for the intermediate product exists ?
Discussion Question 13 : What are : a ) The advantages of cost-plus pricing ? b ) The disadvantages of cost-plus pricing ?
c ) Why is incremental cost pricing the correct pricing method ? Why is full-cost pricing equal to it ?
Problem 5
The Dairy Farm Company , a small producer of milk and cheese , has estimated the quantities of milk and cheese that it can produce with three levels of total expenditures or total costs . These are indicated in the following table . If the price of milk ( product A ) and the price of cheese ( product B ) that the firm receives are $ 1 each per unit of the products , draw a figure showing the maximum total profi t ( p ) that the firm can earn at each level of TC and the overall maximum profit that the firm can earn for the three different levels of TC .
Problem 12 :
a ) Will a monopolist ’ s total revenue be larger with seconddegree price discrimination when the batches on which it charges a uniform price are larger or smaller ? Why ?