Two clinics want to merge. The price elasticity of demand is -.20 and each clinic has fixed costs of Show more Two clinics want to merge.
The price elasticity of demand is -.20 and each clinic has fixed costs of $60000. One clinic has a volume of 7200 marginal cost of $60 and a makrket share of 2%. The other clinic has a volume of 10800 marginal costs of $60 and a market share of 4%. The merged firm would have a volume of 1800 fixed costs of $80000 mariginal costs of $60 and a makret share of 6%. What are the total costs reveneus and profits for each clinic and for the merged firms. I just need one example to get me started please. Show less
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