Question
A monopolist sells in two geographically divided markets, the east and the west. Marginal cost is constant at $50 in both markets. Demand and marginal
A monopolist sells in two geographically divided markets, the east and the west. Marginal cost is constant at $50 in both markets. Demand and marginal revenue in each market are as follows:
QE= 900 - 2*PE MRE= 450 - QE
QW= 700 - PW MRW= 700 - 2*QW
Find the profit-maximizing price and quantity in each market. Graph the results.
What is the economic profit in each market?
In which market is demand more elastic?
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Economics
Authors: Roger A. Arnold
13th edition
1337617385, 1337617383, 9781337670647 , 978-1337617383
