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A monopolist sells in two geographically divided markets the East and the West. Marginal cost is constant at $50 in both markets Demand and marginal revenue in each market are as follows


A monopolist sells in two geographically divided markets, the East and the West. Marginal cost is constant at $50 in both markets. Demand and marginal revenue in each market are as follows:

QE = 900 – 2PE

MRE = 450 – QE

Qw = 700 – Pw

MRW = 700 – 2Qw

a. Find the profit-maximizing price and quantity in each market.

b. In which market is demand more elastic?

May 01 2020 View more View Less

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