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Suppose a Multi-Product Monopolist Sells Two Complementary Goods,A and B

Question 20

Multiple Choice

Suppose a multi-product monopolist sells two complementary goods,A and B. Annual market demand for good A is QdA = 600 - 25PA - 12PB. Each time a consumer buys A, his demand for B is QdB = 4 - 0.4PB. The marginal cost of good A is a constant $4, and the marginal cost of good B is a constant $0.50. Suppose the price of good B is $5. What is the effective marginal cost of selling a unit of good A?


A) $5
B) $4
C) -$5
D) -$9

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