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Firm 1 produces products A and B. It is a monopolist of A, but is only one of many perfectly competitive firms in the market

Firm 1 produces products A and B. It is a monopolist of A, but is only one of many perfectly competitive firms in the market for B. Assume that Firm 1 can extract all the consumer surplus in the A market, under independent pricing. Under this assumption, can Firm 1 increase profits by tying B to A?




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