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Book publishers often use price discrimination across time to increase profits. Toni Morrison's ...

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Book publishers often use price discrimination across time to increase profits. Toni Morrison's ...

Book publishers often use price discrimination across time to increase profits. Toni Morrison's book, A Mercy, was published as a hardcover edition in November 2008 at a price of $23.95. In August 2009, the paperback version was published at a price of $15.00. Assume that 100,000 hardcover books were sold to hard-core Toni Morrison fans in November 2008, and 400,000 paperback books were sold to casual readers in August 2009. Illustrate each of these situations graphically. Assume that the marginal cost of the hardcover version is $2.00 and the marginal cost of the paperback version is $0.75.

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Microeconomics

Edition: 7^th

Authors: Hubbard, O'Brien

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