A firm sells cups in two fake countries, Noland and Yesville. Price discrimination is illegal in Noland and in Yesville. But, the price per cup can be different in Noland than it is in Yesville.
Demand for the firm's cups in Noland is Q = 10 - 2P
Demand for the firm's cups in Yesville is Q = 8 - P
In the above equations, "Q" is quantity of cups and "P" is price per cup
The firm must sell a whole number amount of cups in each country (no fractions of cups)
It cost the firm $2 to make and deliver each cup it sells.
The firm wishes to maximize total profits. Calculate profit maximizing values for:
(Show your calculations to receive credit for your answers)
a) In Noland: Price per cup, quantity of cups, total profits in Noland
b) In Yesville: Price per cup, quantity of cups, total profits in Yesville