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2. Use a single diagram to compare the operating profits of two companies facing the same demand curve. The companies differ in their marginal
2. Use a single diagram to compare the operating profits of two companies facing the same demand curve. The companies differ in their marginal costs only. One company has access to a new technology which lowers its costs to Clow while the second company uses an older production method with associated marginal cost Chigh. Assume Clow < Chigh. Which company has higher operating profits? Which company charges a higher markup?
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