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Suppose that the a firm faces the demand functions in two separate markets. P1= 200-2Q1 P2= 180-4Q2 and that the cost functions is C =

Suppose that the a firm faces the demand functions in two separate markets.

P1= 200-2Q1

P2= 180-4Q2

and that the cost functions is C = 20(Q1+Q2).

a) How much should be sold in the two markets to maximize total profit? What are the corresponding prices? What is the maximal profit?

b) How much profit is lost if becomes illegal to discriminate?

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