a.What are the profit-maximizing prices and quantities for the New York and Los Angeles markets? We know that a monopolist with two markets should pick quantities in each market so that the marginal rvenues in both markets ar equal to one another and equal to marginal cost.Marginal cost is $40 (the slope of the total cost curve).To determine marginal revenues in each market,we first solve or price as a function of quantity: Pxy=240-4Qxr and P,4=200.2Q Since the marginal revenue curve has twice the sbpe of the demand curve,the marginal revenue curves for the respective markets are: MRxy=240-8Qvr and MR4=200-4QL4- Set each marginal revenue equal to marginal cost,and determine the profit-maximizing quantity in each submarket: 40=240-80 or Q=25 and 40=200.4Qa0rQa=40. Determine in each ubmarket quantity into the respective demandequation: Py=240.(④2)=140and P4=200.(2(40)=$120. b.As a consequence of a new satellite that the Pentagon recently deployed, people in Los Angeles receive Sal's New York broadeasts,and people in New York receive Sal's Los Angeles broadcasts.As a result,anyone in New York or Los Angeles can receive Sal's broadcasts by subscribing in either city.Thus Sal can charge only a single price.What price should he charge,and what quantities will he sellin New York and Los Angeles? Given this new satellite,Sal separate the two markets,so he needs to consider the total demand function,which is the horizontal summation o the LA and NY demand functions.Above a price of 200(the vertical intercept of the demand function for Los Angeles viewers).the total demand is iust the New York demand function,whereas below aprice of200,we add the two demands: Qr=60-0.25P+100-0.50P,orQ=160-0.75P Rewriting the demand function results in 1601 P=05070 Now total revenue=PQ=(213.3-1.30)Q.or 213.3Q-1.3Q,and therefore, MR=213.3-2.6Q. a. What are the profit-maximizing prices and quantities for the New York and Los Angeles markets? We know that a monopolist with two markets should pick quantities in each market so that the marginal revenues in both markets are equal to one another and equal to marginal cost. Marginal cost is $40 (the slope of the total cost curve). To determine marginal revenues in each market, we first solve for price as a function of quantity: PNY = 240 - 4QNY and PLA = 200 - 2QLA. Since the marginal revenue curve has twice the slope of the demand curve, the marginal revenue curves for the respective markets are: MRNY = 240 - 8QNY and MRLA = 200 - 4QLA. Set each marginal revenue equal to marginal cost, and determine the profit-maximizing quantity in each submarket: 40 = 240 - 8QNY, or QNY = 25 and 40 = 200 - 4QLA, or QLA = 40. Determine the price in each submarket by substituting the profit-maximizing quantity into the respective demand equation: PNY = 240 - (4)(25) = $140 and PLA = 200 - (2)(40) = $120. b. As a consequence of a new satellite that the Pentagon recently deployed, people in Los Angeles receive Sal’s New York broadcasts, and people in New York receive Sal’s Los Angeles broadcasts. As a result, anyone in New York or Los Angeles can receive Sal’s broadcasts by subscribing in either city. Thus Sal can charge only a single price. What price should he charge, and what quantities will he sell in New York and Los Angeles? Given this new satellite, Sal can no longer separate the two markets, so he now needs to consider the total demand function, which is the horizontal summation of the LA and NY demand functions. Above a price of 200 (the vertical intercept of the demand function for Los Angeles viewers), the total demand is just the New York demand function, whereas below a price of 200, we add the two demands: QT = 60 – 0.25P + 100 – 0.50P, or QT = 160 – 0.75P. Rewriting the demand function results in  P = 160 0.75 − 1 0.75 Q. Now total revenue = PQ = (213.3 – 1.3Q)Q, or 213.3Q – 1.3Q 2 , and therefore, MR = 213.3 – 2.6Q