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Ferdinand Sludge has just written a disgusting new book, Orgy in the Piggery.


5. Ferdinand Sludge has just written a disgusting new book, Orgy in the Piggery. His publisher, Graw McSwill, estimates that the demand for this book in the United States is Q1=50,000-2,000P1, where P1 is the price in the US measured in US dollars. The demand for Sludge’s opus in England is Q2=10,000-500P2, where P2 is its price in England measured in US dollars. His publisher has a cost function C(Q) = $50,000 + $4Q, where Q is the total number of copies of Orgy that it produces.











a. If McSwill can charge a difference price in each country and wants to maximize profits, how many copies should it sell in the US, what price should it charge in the US, how many copies should it sell in England and what price should it charge in England and how much will its total profits be?

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Economics-8203786.doc

Ferdinand Sludge has just written a disgusting new book, Orgy in the Piggery. His
publisher, Graw McSwill, estimates that the demand for this book in the United
States is Q1=50,000-2,000P1, where...

Sign up to view the full answer

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