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Solve clearly {4) Company X is the sole domestic producer of the generic antidepressant Sensitruro with a marginal cost is $2 per dose. Demand is
Solve clearly
{4) Company X is the sole domestic producer of the generic antidepressant Sensitruro with a marginal cost is $2 per dose. Demand is given by Q = 400 50F {Q in millions of doses and P in US dollars]. There is a second producer in India whose marginal cost is $2.7 [including transportation cost to the US). Firms set prices simultaneously, {i} What will he the US market price {PM} for Sensitrum'? Why? (That.- You can provide a mugs? such that Pots is less than andv'or greater than some amount). {Epointsj (ii) At that price range what is Company X's share in the domestic market? {2 point) {iii} Now, assume Pm = 2.5. Calculate Company X's equilibrium prots? (2 points)Step by Step Solution
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