A firm sells its product in two different markets. The inverse demand in market A is P_A= 72 - 5Q_Aand in market B, it is P_B= 60 - 3Q_B. It has fixed costs of 72. Each unit it produces costs 12, i.e., marginal cost equals 12. To maximize profits, what quantities of output will be sold in each market and what will total profits be?

Answer rating: 100% (QA)

To maximize profits the firm should produce where marginal cost equals marginal revenue in each mark... View the full answer