A Book Publisher Faces Two Different Markets with Different Price

question 74

Multiple Choice

A book publisher faces two different markets with different price elasticities of demand for its books.In market A the price elasticity of demand is 6 and in market B the elasticity is 1.5.If the marginal cost of producing a book is $10,how should the firm price its books in the two markets?

• A)market A = $12 and market B = $30
• B)market A = $60 and market B = $15
• C)market A = $15 and market B = $60
• D)market A = $30 and market B = $12

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Definitions:

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