Question
The Stoli Group makes a very high-end bourbon named Kentucky Owl. The marginal cost of making a 750-milliliter bottle of Kentucky Owl is $60. Stoli
The Stoli Group makes a very high-end bourbon named Kentucky Owl. The marginal cost of making a 750-milliliter bottle of Kentucky Owl is $60. Stoli is deciding what price is should set for Kentucky Owl in Kentucky and all other states. The elasticity of demand in Kentucky is -4, whereas the elasticity in all other states is -3. This suggests that a. The price of Kentucky Owl should be $90 in Kentucky and $80 in all other states. b. The price of Kentucky Owl should be $90 everywhere. c. The price of Kentucky Owl should be $80 everywhere. d. The price of Kentucky Owl should be $80 in Kentucky and $90 in all other states.
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