Question

A perfectly price-discriminating monopolist is able to a. maximize profit and produce a socially optimal level of output. b. produce a socially optimal level of output, but not maximize profit. c. exercise illegal preferences regarding the race and/or gender of its employees. d. maximize profit, but not produce a socially optimal level of output.

Answer 1

Answer:

a. maximize profit and produce a socially optimal level of output.

Explanation:

The perfect price discrimination is the discrimination that arise isn the case when a firm charge a different price for each unit i.e. consumed. In this, the maximum price should be charged that enables to capture the overall consumer surplus. It is also known as first degree price discrimination

Here the profit is maximized and generated an optimal output level

Therefore the correct option is a.