Answer to Question #349006 in Microeconomics for Kwame

Question

The following are two distinct demand functions: 𝑞1=24−0.2𝑃1 and 𝑞2=10−0.05𝑃2. The average cost AC=40+35/q. What price the firm will change without discrimination?

Answer 1

$q_1=24-0.2p,$

$q_2=10-0.05p,$

$q_1=q_2,$

$24-0.2p=10-0.05p,$

$14=0.15p,$

$p=93.3,$

$q_1=q_2=5.3.$