Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A Monopolist selling a cell phone in two separate markets. They must decide how much to sell in each market in order to maximize their

A Monopolist selling a cell phone in two separate markets. They must decide how much to sell in each market in order to maximize their total profits.

The demand in the Brazilian Market is :  QBrazil = 120 – 10PBrazil

The demand in the United States Market is:  QUSA = 60 – 20PUSA

If Total Cost is: TC = 90 + 2(QUSA +QBrazil)

Calculate the Price and Quantity if the Monopolist Maximized their profit and sells in both markets? (8 Points)

Calculate the Profit if he Monopolist Maximized their profit and sells in both markets? (6 Points)

In the absence of 3rd Degree Price Discrimination and the firm must sell at the same price in both markets, what is the price, quantity and total profit? (6 Points)

Step by Step Solution

3.49 Rating (156 Votes )

There are 3 Steps involved in it

Step: 1

To maximize profit the monopolist will set marginal revenue equal to marginal cost in each market Ma... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Microeconomics

Authors: Austan Goolsbee, Steven Levitt, Chad Syverson

1st Edition

978-1464146978, 1464146977

More Books

Students also viewed these Economics questions

Question

What is a make-or-buy decision?

Answered: 1 week ago