Need help with both questions Market 1 Market 2 MC 10 20 30 40 50 70 80 901 0 10

Question

Need help with both questions

Market 1 Market 2 MC 10 20 30 40 50 70 80 901 0 10 20 30 40 50 80 70 B0 901 Quantity sold in Market 1 Quantity sold in Market 2 If the firm wants to maximize profits, what price will it charge in Market 1, and what quantity will it sell? The firm will charge a price of $4 and will sell a quantity of 70 units. (Enter numeric responses using integers). If the firm wants to maximize profits, what price will it charge in Market 2, and what quantity will it sell? The firm wll charge a price of sand will sell a quantity of units

Explanation / Answer

Profit maximization condition : Marginal Revenue = Marginal Cost .

1) Market 1 :

Price = 11 $ ( the MR cuts MC at $ 4 but the corresponding point on the demand curve is 11$ )

Quantity = 35 units

2) Market 2 :

Price = $ 9

Quantity = 50 units

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