A producer has the possibility of discriminating between the rural and urban markets for his/her products, where the demands for the two markets respectively are: Q1 = 21 – 0.1P1 Q2 = 50 – 0.4P2 The total cost of this producer is given as TC = 2000 + 10Q, where Q = Q1 + Q2. What price will the producer charge in order to maximize profits: a. With discrimination between markets? b. Without discrimination?
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