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7) You manage a farm that is looking to sell oranges in both California and Oregon. The demand for oranges in California is given by
7) You manage a farm that is looking to sell oranges in both California and Oregon. The demand for oranges in California is given by PCA = 25 - 0.5QCA and the demand in Oregon is POR = 19 - 0.3QOR. The total cost of selling oranges is TC = 10 + Q and the marginal cost is constant at MC = $1. a) If you can differentiate between customers in California and Oregon, what price would you charge in California? What price would you charge in Oregon? b) If you cannot differentiate between customers in California and Oregon, and you are forced to charge the price that is optimal in California in both Oregon and California, how much profit will you lose compared to the profit you made in (a)
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