Philip Industries manufacture a certain product that can be sold directly to retail outlet or to the Superior Company for further processing and eventual sale as a completely different product. The demand function for each of these markets is
Retail Outlet P1= 60 -2Q1
Superior Company P2 = 40- Q2
Where P1 and P2 are the price charged and Q1 and Q2 are the quantities sold in the respective markets. Philips total cost function for the manufacture of the product is
TC = 10 + 8 (Q1 + Q2)
a. Determine Philips total profit function
b. What are the profits -maximizing price and output levels for the product in the two markets?
c. At these levels of output, calculate the marginal revenue in each market