Microeconomics: Theory and Applications with Calculus, 4e

Exercises

All exercises are available on MyEconLab; $=_{*}answer\text{}at$ * = answer* = answer at the back of this book; $\text{M}=mathematical$ M = mathematicalM = mathematical problem.

1. Conditions for Price Discrimination 

1. 1.1 As of 2015, the pharmaceutical companies Abbott Laboratories, AstraZeneca, Aventis Pharmaceuticals, Bristol-Myers Squibb Company, Eli Lilly, GlaxoSmithKline, Janssen, Johnson & Johnson, Novartis, Ortho-McNeil, and Pfizer provide low-income, elderly people with discounts on many prescription medicines. Why would these firms do that?

2. 1.2 Alexx’s monopoly currently sells its product at a single price. What are the necessary conditions so that he can profitably price discriminate?

3. *1.3 Spenser’s Superior Stoves advertises a ...