Consider the market for the g-jeans (the latest fashion among people in their late thirties). gjeans are sold by a single firm that carries the patent for the design. on the demand side, there are nh > 0 high-income consumers who are willing to pay a maximum amount of vh for a pair of cjeans, and nl > 0 low-income consumers who are willing to pay a maximum amount of vl for a pair of g-jeans. assume that vh > vl > 0 and that each consumer buys only one pair of jeans. suppose that the g-jeans monopoly cannot price discriminate and is therefore constrained to set a uniform market price.
(a) draw the market aggregate-demand curve facing the monopoly.
(b) find the profit-maximizing price set by g-jeans, considering all possible parameter values of nh, nl, vh and vl. assume that production is costless.
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Consider the market for the g-jeans (the latest fashion among people in their late thirties). gjeans...
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