ECONOMICS --> Socially Optimal Pricing?
Demand for the output of a public project has three distinct phases of equal duration over a demand cycle. If each demand function is stated as if it lasted one entire cycle,
Q1= 2,700 - 100P1
Q2= 1,500 - 100P2
Q3= 800 - 100P3
Short run marginal cost is $3 per unit, while long-run marginal cost is $5 per unit. Both are constant. Capacity output is 1,800 units.
What are the socially optimal prices (P1, P2, P3)? Use a diagram to illustrate your answer.
- farrukh_phdLv 41 decade agoFavorite Answer
how can we use a diagram in this answering forum ? ?