Suppose the merger of two firms Heinz and Beech Nut will reduce the price elasticity...
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Suppose the merger of two firms Heinz and Beech Nut will reduce the price elasticity of demand for each firm s product from 2 to 1 For each firm the average cost of production is constant at 3 per unit Suppose Heinz initially has a price of 10 at which they sell 100 units and is considering raising the price to 11 Compute the profit with the new price of 11 after the merger elasticity 1
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