(Answered) 1 nbspone planttwo markets-price discriminationrussco

Economics

1) (One Plant/Two Markets-Price Discrimination)

RussCo manufactures a proprietary pesticide that can is made at a plant in the United States and a plant in South Korea:

South Korean Cost Function: TCsk = 2Q2SK + 2QSK

United States Cost Function: TCusa = ½Q2USA + 4QUSA

The market demand is: P = 243 - ½Q

A. What is the profit-maximizing price?

B. What is the Quantity produced in each Country?

C. What are RussCo's total profits if the firm is effectively able to produce in both Countries?

D. Calculate the profit-maximizing level of price and output if RussCo closes its United States factories? What are RussCo's profits this condition?

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