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How to determine the optimal price of a product as a monopolist

Posted by Arpad on 5/21/21 12:00 PM

In business, finding the right price for your product is crucial. Price it too high, and few people will buy; price too low and the business leaves money on the table. But how do you determine the right price? We will explore this question with a simplified example, looking at Umbrella Corp (UCorp). Note that in this simplified case, UCorp is a monopolist and cannot charge different prices to different customers (i.e. is unable price discriminate).

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Tags: economics, business