Suppose a firm faces two different types of consumers such as those to the right. The leftmost market illustrates very inelastic demand while the one to the right illustrates more elastic demand.

   For simplicity we suppose that MC is constant. This isn't so unreasonable... it probably costs the same to show a movie to the marginal matinee or evening customer (nearly zero) and it costs the same to fly a full fare coach as a super-saver coach passenger.

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