3. The monopolist with marginal cost of production of 40 sells to two distinct regions. In Region 1, demand is given by Q1=300-p1. In region2, it is given by Q2=180-p2. 1) Determine the optimal uniform price and output when discrimination is impossible. 2) Assume discrimination between the two regions is possible. What price will be set for each region? What quantity will be sold in each region? 3) How does the discriminatory price relate to the elasticity of demand in each country?

3. The monopolist with marginal cost of production of 40 sells to two distinct regions. In Region 1, demand is given by Q1=300-p1. In region2, it is given by Q2=180-p2.

1) Determine the optimal uniform price and output when discrimination is impossible.

2) Assume discrimination between the two regions is possible. What price will be set for each region? What quantity will be sold in each region?

3) How does the discriminatory price relate to the elasticity of demand in each country?

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