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A chocolate manufacturer can produce normal or gourmet chocolate bars. The marginal cost of production is $1 for normal bars and $3 for gourmet bars.
A chocolate manufacturer can produce normal or gourmet chocolate bars. The marginal cost of production is $1 for normal bars and $3 for gourmet bars. There are two types of consumers in the market: light consumers who make up a fraction, p, of the market, and heavy consumers who make up a fraction, 1 -p, of the market. Note that 0
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