Refer to the information provided in Figure 13.11 below to answer the question(s) that follow. Figure 13.11
-Refer to Figure 13.11. Suppose a monopolist faces the demand and costs in the figure and is able to perfectly price discriminate. How much profit does the monopolist earn?
A) $0
B) $16,000
C) $32,000
D) Indeterminate from the given information.

Question

Refer to the information provided in Figure 13.11 below to answer the question(s) that follow.  Figure 13.11
-Refer to Figure 13.11. Suppose a monopolist faces the demand and costs in the figure and is able to perfectly price discriminate. How much profit does the monopolist earn?
A) $0 
B) $16,000 
C) $32,000 
D) Indeterminate from the given information.

Quizplus · Accepted Answer

When a monopolist can perfectly price discriminate, it means they can charge each consumer the maximum they are willing to pay for each unit, effectively capturing the entire area under the demand curve down to the cost curve as profit. The profit in this scenario is represented by the area between the demand curve and the cost curve, up to the quantity where the cost curve intersects the demand curve. Without seeing Figure 13.11, the specific answer relies on knowledge that perfect price discrimination allows the monopolist to capture all consumer surplus as profit. If the given answer is $16,000, it suggests that this is the calculated area representing the monopolist's profit under perfect price discrimination, assuming the figure shows a clear demarcation of this area.

Refer to the Information Provided in Figure 13