A Japanese steel firm sells steel in the United States and in Japan.Since the United States buys steel from a number of sources,the U.S.demand for Japanese steel is more price-elastic than is the Japanese demand for Japanese steel.If the Japanese steel firm wishes to maximize its profits,it should:
A) charge the same price in both countries (after adjusting for transportation costs) .
B) charge a higher price in the United States and a lower price in Japan;otherwise,it would be accused of unfair trade practices.
C) charge a lower price in the United States and a higher price in Japan.
D) figure out which market is more profitable and sell only in that market.
Correct Answer:
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