(d) (3%) Compare your answer in (c) to a demand function for L derived from a Cobb-Douglas production function (e.g., Q = L^0.5K^0.5), which demand for L is relatively insensitive to w?

5. Suppose Max is a profit-maximizing monopoly firm that sells a well-designed chair. The firm faces the demand curve $$P = 28 - 0.5Q$$. I. If the total cost for producing Q units of output is $\mathrm{TC} = 24 + 1.5\mathrm{Q}^2$. The fixed cost is sunk, and the marginal cost curve is $\mathrm{MC} = 3\mathrm{Q}$. (a) (6%) How much extra surplus does the producer capture when it can engage in first-degree price discrimination instead of charging a uniform price?

(d) (3%) Compare your answer in (c) to a demand function for \( L \) derived from a Cobb-Douglas production function (e.g., \( Q = L^{0.5}K^{0.5} \)), which demand for \( L \) is relatively insensitive to \( w \)?

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