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When a pure monopoly practices first-degree price discrimination, which of the following occurs?
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12. Monopoly
Price Discrimination
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The total revenue for the perfectly price discriminating monopolist from selling five units of output is:
A
\$5
B
\$15
C
\$18
D
\$25
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Understand that a perfectly price discriminating monopolist charges each consumer the maximum price they are willing to pay for each unit.
Refer to the demand schedule provided. For each unit sold, the price is different, reflecting the maximum willingness to pay.
Calculate the total revenue by summing up the prices for the first five units sold. According to the demand schedule, these prices are \$8, \$7, \$6, \$5, and \$4.
Add these prices together: \$8 + \$7 + \$6 + \$5 + \$4.
The sum of these prices will give you the total revenue for selling five units of output.
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