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I Auto can produce any quantity of cars at a constant marginal cost equal to $100 and a total foced cost of $10000 globally You are asked to advise the CEO as to what prices and quantities LI Auto should set for car sales in Europe and in the US to maximize its profits The demand for LI Auto in each market is given by Q= 6000 -8P and Q, = 4000 - 2 Pwhere the subscript E denotes Europe, the subscript U denotes the US Assume that LI Auto can restrict Europe or US car sales to authorized LI Auto dealers only. It, by an international agreement between Europe and US, LI Auto was forced to charge the same price in each market, calculate the following (round off to nearest number): Question: 1. Equilibrium Price 2. Quantity of cars sold in Europe and In the US 3, Total Profit

I Auto can produce any quantity of cars at a constant marginal cost equal to $100 and a total foced cost of $10000 globally You are asked to advise the CEO as to what prices and quantities LI Auto should set for car sales in Europe and in the US to maximize its profits The demand for LI Auto in each market is given by Q= 6000 -8P and Q, = 4000 - 2 Pwhere the subscript E denotes Europe, the subscript U denotes the US Assume that LI Auto can restrict Europe or US car sales to authorized LI Auto dealers only. It, by an international agreement between Europe and US, LI Auto was forced to charge the same price in each market, calculate the following (round off to nearest number): Question: 1. Equilibrium Price 2. Quantity of cars sold in Europe and In the US 3, Total Profit

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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LI Auto can produce any quantity of cars at a constant marginal cost equal to $100 and a total foxed cost of $10000 globally You are asked to advise the CEO as to what prices and quantties LI Auto should set for car sales in Europe and in the US to maximize its profits The demand for LI Auto in each market is given by Og= 6000-8 P and Q, = 4000-2 P,where the subscript E denotes Europe, the subscript U denotes the US. Assume that LI Auto can restrict Europe or US car sales to authorized LI Auto dealers only. If, by an international agreement between Europe and US, LI Auto was forced to charge the same price in each market, calculate the following (round of to nearest number): Question: 1. Equilibrium Price 2. Quantity of cars sold in Europe and In the US 3. Total Profit
Transcribed Image Text:LI Auto can produce any quantity of cars at a constant marginal cost equal to $100 and a total foxed cost of $10000 globally You are asked to advise the CEO as to what prices and quantties LI Auto should set for car sales in Europe and in the US to maximize its profits The demand for LI Auto in each market is given by Og= 6000-8 P and Q, = 4000-2 P,where the subscript E denotes Europe, the subscript U denotes the US. Assume that LI Auto can restrict Europe or US car sales to authorized LI Auto dealers only. If, by an international agreement between Europe and US, LI Auto was forced to charge the same price in each market, calculate the following (round of to nearest number): Question: 1. Equilibrium Price 2. Quantity of cars sold in Europe and In the US 3. Total Profit
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