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Camgo company makes inexpensive, fixed-focus 35 mm cameras. Its subsidiary, Focrude makes the lenses for the cameras. Being highly competitive, lenses are bought or sold
Camgo company makes inexpensive, fixed-focus 35 mm cameras. Its subsidiary, Focrude makes the lenses for the cameras. Being highly competitive, lenses are bought or sold at the equilibrium price of $2. Camera demand function: Qc = 12,000-400Pc. MRc =30 - 0.005Qc. P8 . Marginal cost, excluding lenses, is $5. of (Marginal cost of Focrude) MCf = 0.30 + 0.0004Qf. Each camera requires one lens. Question: Will Focrude be able to both supply and sell profitably in the outside market
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