Consider the demand for schnitzel in the diagram below Suppo

Consider the demand for schnitzel in the diagram below. Suppose that there is a single seller of schnitzel, who acts as a single-price monopolist.

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Suppose the seller begins perfectly price-discriminating. What areas that used to be neither consumer surplus nor producer surplus now become producer surplus?

	E + H
	A + B
	E
	H

Seller would be at equilibrium where MC=MR i.e at G

Total quantity sold= EHQ2Q1------------------------------------1

Surplus= EGH

But producer surplus of qty. sold= Q1AB------------------------------------2

Therefore new Producer surplus= 2-1= EHQ2Q1-Q1AB

= ABD at Price= P1

By,

Nishant Bhatt

Consider the demand for schnitzel in the diagram below. Suppose that there is a single seller of schnitzel, who acts as a single-price monopolist. Suppose the

Consider the demand for schnitzel in the diagram below Suppo

Solution

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