6. A drug company has a monopoly on a new patented medicine.The product can be made in either of two plants. The total costsof production for the two plants (Plant 1 and Plant 2) are givenby:TC₁(Q₁) = 100TC₂(Q2) = 200where 2 and 22 are the level of output produced by Plant 1 andPlant 2, respectively.The firm's estimate of demand for the product is given byP=20-3(Q+22)where P is the unit price of the product.(a) Suppose that this company is not able to price discriminate.What are the profit maximizing level of output produced by Plant1 and Plant 2?(b) At what price will it sell the product?

Answered: 6. A drug company has a monopoly on a…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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