Answer to Question #342263 in Financial Math for mukti

Question #342263

A firm has the possibility of charging different prices in its domestic and foreign markets. The corresponding demand equations are given below by


Q1=300-P1


Q2= 400-2P2


The total cost function is


TC= 5000+100Q


Where Q=Q1+Q2


Determine the priced (in dollers) that the firm should charge to maximise profits



a) with price discrimination


b) without price discrimination


Compare tge profits obtained in parts (a) and (b)


c) What will be the effect of a tax of 8 taka per unit output on the optimal quantity, price and profits for the firm, assuming there is no price discrimination?




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