International Market Assignment | Homework For You
United Kingdom PRICE (Dollars per toy) 0 200 400 600 800 QUANTITY (Toys) 1000 1200 Canada PRICE (Dollars per toy) + + + + o 200 1000 1200 400 600 800 QUANTITY (Toys) Total Market MC PRICE (Dollars per toy) ATC DUK+C Total Profit MR 0 200 1400 1600 400 600 800 1000 1200 QUANTITY (Hundreds of toys)
In the absence of international dumping, BTI charges a uniform price to U.K. and Canadian customers (ignoring transportation costs). The firm’s profit-maximizing output is toys, the price is $ , and total profit is $ .
Based on the graphs for the United Kingdom market and the Canadian market, respectively, BTI’s profits on its U.K. sales BTI’s profits on its Canadian sales. Suppose now that BTI engages in international dumping. Then in the U.K., BTI charges the price of $ per toy, and the profits that it accrues on U.K. sales goes to $ . In Canada, BTI charges the price of $ per toy, and the profits that it accrues on Canadian sales equal . With dumping, total profits by $ compared to the case of a nondiscriminating seller. Get Economics homework help today