Amonopolist is deciding how to allocate output between two geographically separated markets
(east coast and midwest). demand and marginal revenue for the two markets are:
p1 = 15 -q1 > mr1 = 15 - 2q1
p2 = 25 - 2q2 > mr2 = 25 - 4q2
the monopolists total cost is c = 5 - 3(q1 - q2 ). what are price, output, prots, marginal revenues, and deadweight loss if
(a) the monopolist can price discriminate?
(b) if the law prohibits charging dierent prices in the two regions?
Answers: 3
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