The price elasticity of demand for senior citizens purchasing coffee from McDonald's is -5 while non senior citizens have a price elasticity of demand equal to -1.25. If is cost McDonald's $0.02 to produce a coffee, the optimal price for a cup of coffee for non senior citizens and resultant marginal cost under third-degree price discrimination are
A. $0.004 and $0.02.
B. $0.02 and $0.80.
C. $0.10 and $0.02.
D. $10 and $0.20.
1 answer
Lie