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Suppose the number of firms you compete with has recently increased. You estimated that as a result of the

increased competition, the demand elasticity has increased from -2 to -3, i.e., you face more elastic demand. You are currently charging $10 for your product. If demand elasticity is -3, you should charge [x].

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Let the marginal cost be MC. Optimum rule suggests that P1... View the full answer

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