A Monopolist Has a Constant Marginal Cost of $2 Per

A monopolist has a constant marginal cost of $2 per unit and no fixed costs. He faces separate markets in the United States and England. He can set one price p₁ for the U.S. market and another price p₂ for the English market. If demand in the United States is given by Q₁ = 7,000 - 700p₁ and demand in England is given by Q₂ = 1,200 - 200p₂, then the price in the United States will

A) equal the price in England.
B) be smaller than the price in England by $2.
C) be larger than the price in England by $4.
D) be larger than the price in England by $2.
E) be smaller than the price in England by $4.

Correct Answer:

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