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DragonLovely
DragonLovely
28.05.2020 • 
Business

A monopoly book publisher with a constant marginal cost (and average cost) of MCequals$9 sells a novel in only two countries and faces a linear inverse demand curve of p 1equals6minus0.5Upper Q 1 in Country 1 and p 2equals18minusUpper Q 2 in Country 2. What price would a profit-maximizing monopoly charge in each country with and without a ban against shipments between countries? With a ban against shipments between countries, the monopoly would sell Country 1 Upper Q 1equals 0 units and Country 2 Upper Q 2equals 4.5 units. (Enter your responses rounded to two decimal places.) Without a ban against shipments between countries, the monopoly would maximize profit by selling Qequals 4.5 units. How would the analysis change if MCequals$4? (Hint: Where MCequals4, the marginal cost curve crosses the MR curve three timeslong dashif we include the vertical section. The single-price monopoly will choose one of these three points where its profit is maximized.) With a ban against shipments between countries, the monopoly would sell Country 1 Upper Q 1equals 2 units and Country 2 Upper Q 2equals 7 units. (Enter your responses rounded to two decimal places.) Without a ban against shipments between countries, the monopoly would maximize profit by selling Qequals 7 units at a price of $ 11. Question is complete. All parts showing

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