A monopoly sells its good in the U.S. and Japanese markets. The American inverse demand function is
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A monopoly sells its good in the U.S. and Japanese markets. The American inverse demand function is pA = 100 – QA, and the Japanese inverse demand function is pJ = 80 – 2QJ, where both prices, pA and pJ, are measured in dollars. The firm’s marginal cost of production is m = 20 in both countries. If the firm can prevent resale, what price will it charge in both markets?
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By differentiating we find that the American marginal revenue function is MR A 100 2 Q A and the Jap...View the full answer
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Related Book For 
Managerial Economics and Strategy
ISBN: 978-0321566447
1st edition
Authors: Jeffrey M. Perloff, James A. Brander
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