Calculate the firms quantities supplied in the two markets

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Reference no: EM13268512

Assume a monopolist exporter faces the following demand curves in its domestic and foreign markets respectively: Q = 3000 - 0.5P and Q* = 2000 - 0.2P*, where P and P* represent real domestic and foreign prices. All costs are incurred domestically and the average cost per unit is 600. Calculate the firm's quantities supplied in the two markets, prices charged and profits at real exchange rates (RS domestic per foreign currency) of 2 and 2.5.

Reference no: EM13268512

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