A monopolist faces demand $P = 400 - 4 Q ^ { d }$ and has constant marginal cost $M C = 80$ . If this monopolist engages in first-degree price discrimination, consumer surplus will be
A) 0
B) 1,600
C) 3,200
D) 12,800

Question

Quizplus · Accepted Answer

In first-degree price discrimination, the monopolist captures all consumer surplus by charging each consumer their maximum willingness to pay. Therefore, consumer surplus is 0.

A Monopolist Faces Demand P=400−4QdP = 400 - 4 Q ^ { d }P=400−4Qd

A Monopolist Faces Demand $P = 400 - 4 Q ^ { d }$