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A Monopolist Sells in Two Markets

Question 3

Multiple Choice

A monopolist sells in two markets.The demand curve for her product is given by p1 = 141 - 3x1 in the first market and p2 = 115 - 2x2 in the second market, where xi is the quantity sold in market i and pi is the price charged in market i.She has a constant marginal cost of production, c = 3, and no fixed costs.She can charge different prices in the two markets.What is the profit-maximizing combination of quantities for this monopolist?


A) x1 = 46 and x2 = 30.
B) x1 = 51 and x2 = 23.
C) x1 = 23 and x2 = 28.
D) x1 = 33 and x2 = 26.
E) x1 = 43 and x2 = 38.

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