Business, 17.12.2019 21:31 savrosed

Sony will sell 3,000 aibo robots in japan for 250,000 yen ($2,070) each and 2,000 in the united states for $2,500 each -- but only over the internet.

suppose that sony is a monopoly in the production of the aibo. it produces in a single plant that hasconstant ac=mc= 20. sony has been able to estimate two demand functions, one for the us market andone for the japanese market. the direct demand functions for the us and japanese markets arerespectively:
qus =100 – pusqj = 40 – .5 pj
a. assuming that sony can prevent resale from one group of customers to the other, what will bethe profit maximizing quantity that sony will sell in each market and what will be the price it will charge for the aibo in each market? calculate profits.

b. calculate the elasticities of demand in each market. does your result make sense given the prices you found for the two markets? explain in a sentence or two. note, you can assume that thedifferences in the two prices is not attributable to differences in costs.

c. now, assume that sony cannot prevent resale between the two groups of consumers. solve forthe profit maximizing quantity and price? what would be profits?

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Sony will sell 3,000 aibo robots in japan for 250,000 yen ($2,070) each and 2,000 in the united stat...

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