Suppose a firm faces the inverse demand curve P = 100 - Q. Marginal cost is constant at $10.
Suppose the firm uses block pricing, selling the first 45 units at $55 per unit, the next 20 units at $35 per unit, and the next 20 units at $15 per unit. The producer surplus in this case is $____.
A) 2,000
B) 2,025
C) 2,465
D) 2,625

Question

Quizplus · Accepted Answer

The Answer of Suppose a firm faces the inverse demand curve P = 100 - Q. Marginal cost is constant at $10.
Suppose the firm uses block pricing, selling the first 45 units at $55 per unit, the next 20 units at $35 per unit, and the next 20 units at $15 per unit. The producer surplus in this case is $____.
A) 2,000
B) 2,025
C) 2,465
D) 2,625

Suppose a Firm Faces the Inverse Demand Curve P =