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Two clinics in a market want to merge. The price elasticity of demand for clinic services is -0.20, if before a merge, firm A has
Two clinics in a market want to merge. The price elasticity of demand for clinic services is -0.20, if before a merge, firm A has marginal costs of $60 and a market share of 2 percent, and firm B has marginal costs of $60 and a market share of 4 percent. After the merger, the merged firm should be charging a price of:
- $100
- $60.00
- $85.71
- $66.67
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