Gliberace’s Fashion Accessories of Las Vegas produces gem-stone encrusted formal wear for sale in Los Angeles and San Francisco subject to total cost TC = 100 + 6(QLA + QSF). Demand for Gliberace’s stones in the two cities is given by QLA = 70 – 2PLA and QSF = 50 – PSF. If Gliberace cannot price discriminate between the two cities, and so charges the same price in each, how many stones will it sell in Los Angeles? what will be that price? how much profit will the firm make?
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