If the firm is forced to charge the same price in both market, what would be the total number of cars they sell in both markets? Please provide a numerical answer in millions of cars. For example, if the answer is 3,524,000 (3 million and 524 thousand cars), put 3.524 in the answer field. Suppose that BMW can produce any quantity of cars at a constant marginal cost equal to $20,000and a fixed cost of $10 billion. You are asked to advise the CEO as to what prices and quantitiesBMW should set for sales in Europe and in the United States. The demand for BMWs in the U.S. isgiven by Qu = 1, 000, 000 – 20PŲ. The demand for BMWs in Europe is given by QE4,000,000 - 100PE. All prices and costs are in U.S. dollars. Assume that the company can preventresale between the two markets.=

Given The marginal cost of production BMW car =$20,000 Fixed cost =$10 billion or 10000 million The…

Answered: Suppose that BMW can produce any…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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If the firm is forced to charge the same price in both market, what would be the total number of cars they sell in both markets? Please provide a numerical answer in millions of cars. For example, if the answer is 3,524,000 (3 million and 524 thousand cars), put 3.524 in the answer field.

Suppose that BMW can produce any quantity of cars at a constant marginal cost equal to $20,000
and a fixed cost of $10 billion. You are asked to advise the CEO as to what prices and quantities
BMW should set for sales in Europe and in the United States. The demand for BMWs in the U.S. is
given by Qu = 1, 000, 000 – 20PŲ. The demand for BMWs in Europe is given by QE
4,000,000 - 100PE. All prices and costs are in U.S. dollars. Assume that the company can prevent
resale between the two markets.
=

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