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A monopoly sells its good in the U.S. and Japanese markets. The American inverse demand function is Pa = 110 - Qa, and the Japanese
A monopoly sells its good in the U.S. and Japanese markets. The American inverse demand function is Pa = 110 - Qa, and the Japanese inverse demand function is pj =90 -20j, where both prices, Pa and p;, are measured in dollars. The firm's marginal cost of production is m = $20 in both countries. If the firm can prevent resales, what price will it charge in both markets? (Hint: The monopoly determines its optimal (monopoly) price in each country separately because customers cannot resell the good.) The equilibrium price in Japan is $ . (round your answer to the nearest penny)
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