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micro question Suppose your firm has developed new super-warm ski gloves that you plan to sell in the U.S. and in Canada. Assume your firm

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Suppose your firm has developed new super-warm ski gloves that you plan to sell in the U.S. and in Canada. Assume your firm has some market power (in other words, the market is not perfectly competitive, and the firm can price discriminate). The demand curve in Canada is P = 120 -2Q The demand curve in the U.S. is P = 60 - 2Q where P is the price per pair of gloves (assume prices in U.S. dollars for both countries) and Q is pairs sold per month. Suppose your firm faces a constant marginal cost of $20 per pair of gloves. Will the firm charge a higher price in the U.S. or in Canada? Explain the reasoning behind your answer. You do not have to show any calculations, but you should explain why the price is different, if it is, in each country. (You can use numbers to support your answer but the explanation of why is most important.)

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