When selling its famous Levi 501jeans, LeviStrauss's price discriminates between the European and Americanmarkets, selling the product at a higher price in Europe than in the United States. The following equations are hypothetical demand curves forLevi's 501s in Europe and in America. We have expressed the price in dollars in bothmarkets, and quantity is thousands of units per year.EuropeanDemand: QDE=150pAmericanDemand: QDA=2504pSuppose Levi Strauss has a constant marginal cost of$15 per unit. a. Use the line drawing tool to plot the two MRcurves, two demandcurves, and the MC curve. Recall that astraight-line demand curve has an associated MR curve that has twice its slope. Label the curves properly.Carefully follow the instructionsabove, and only draw the required objects. b. What is theprofit-maximizing price in eachmarket? Theprofit-maximizing price in the European market is ......

Study Resources v Textbook Solutions Expert Tutors Lam v When selling its famous Levi 501 jeans, Levi Strauss's price discriminates between the European and American markets, selling the product at a higher price in Europe than in the United States. The following equations are hypothetical demand curves for Levi's 501s in Europe and in America. We have 175 expressed the price in dollars in both markets, and quantity is thousands of units per year. Q European Demand: Oge = 150 -p 150 American Demand: OnA - 250-4p 125 Suppose Levi Strauss has a constant marginal cost of $15 per unit. a. Use the line drawing tool to plot the two MR curves, two demand curves, and the MC curve. Recall that a straight-line demand curve has an 100 associated MR curve that has twice its slope. Label the curves property Price ($) 75- Carefully follow the instructions above, and only draw the required objects. b. What is the profil-maximizing price in each market? 50 The profil-maximizing price in the European market is 25 you The profit-maximizing price in the American market is 50 100 180 200 300 Quantity Explain why profit maximization requires the MC be equated to MR in each market segment. If an extra unit of output will increase the firm's revenues by more than it increases costs, that is V. the firm should expand its output. However, if the last unit produced increases revenues by less than it increases cost, that is V. the profit-maximizing firm should reduce its output. Therefore, If it is worthwhile for the firm to produce at all, the firm should produce the output at which marginal revenue equals marginal cost. c. Compute the price elasticity of demand (at the profit-maximizing points) in each market segment. (You may want to review Chapter 4 on elasticity at this point) The price elasticity of demand (at the profit-maximizing points) in the American market is |. and in the European market is . (Round your responses to two decimal points. The market segment with V elastic demand has the higher price. i need help thank you. Law Social Science Tax law ECOM 102