Question

How does a monopoly increase a corporation’s profit ?

Answer 1

Monopoly can increase a corporation s profits of the corporation by applying a policy of price discrimination. Price discrimination is the sale of the same product to different buyers at different prices. By applying price discrimination, the monopoly increases the price above the equilibrium level or increases the volume of sales, due to which the profit increases. Examples of this policy are the sale of the monopoly of their products by separate batches; At the same time, it sells the first batch at a higher price than the subsequent.