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Big Pill sells their patented drug Z410 in both the US and Mexico. The marginal cost of producing each pill is $10 regardless of market.
Big Pill sells their patented drug Z410 in both the US and Mexico. The marginal cost of producing each pill is $10 regardless of market. Assume for simplicity no fixed costs. US: Q = 100,000 - 1000P or P = 100 - .001Q Mexico: Q = 800,000 - 9000P or P = 89 - .0001Q If Big Pill charges different prices to the two market segments, what is the optimal price and quantity for each segment? What are the total profits for the company
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