Please enable JavaScript.
Coggle requires JavaScript to display documents.
Monopoly (Assumptions (There is 1 single firm, There are massive barriers…
Monopoly
-
Price discrimination
This is where you charge higher prices for customers with more inelastic demand. This is because they are more likely to spend more money on a ticket, as they demand it more. e.g. a business class plane ticket.
-
Winners
-
-
-
-
Higher output means lower costs, so all customers in the LR
Losers
-
-
Monopolist - as they must work out prices, PED, enforcing discrimination, must prevent secondary market
-
Graphs
Profit maximising
-
-
if C1 is below P1 (where Q1 meets AR) then there is super normal profit. (if the same then t normal, if above, then it is a loss)