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In: Economics

A producer of athletic shoes produces all of its basketball shoes at a constant marginal cost...

A producer of athletic shoes produces all of its basketball shoes at a constant marginal cost of $50 per pair. It sells a brand-name version of the shoe with a basketball star endorsement to one market (A) and an identical “discount” brand version to another separate market (B). The demand for the shoes in each market is given by:

QA = 100 – 0.2p
QB = 40 – 0.4p

  • What is the price per pair in the brand-name market (A) dollar?
  • What is the price per pair in the discount market (B) dollar?

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Expert Solution

Rahul Sunny answered 2 years ago
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