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Assume the price elasticity of demand for physicians' services is 0.2. If your marginal cost per visit is $20, what is your profit-maximizing price if
Assume the price elasticity of demand for physicians' services is 0.2. If your marginal cost per visit is $20, what is your profit-maximizing price if you control 5 percent of the market? What is your profit-maximizing price if you control 15 percent of the market? What lessons do you draw from this information? I have the textbook answers which state that at 5% market share the profit-maximizing price is $26.67 and at 15% market share the profit maximizing price is $80. I need to show how I arrived at those figures.
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