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Towns of roughly the same size

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Aristotle Murphy owns movie theatres in two towns of roughly the same size, 100 kilometers apart. In Monopolia, he owns the only chain of theatres (he is a monopolist). In Competitia, there is no theatre chain and he is only one of a number of independent theatre operators. Would you expect movie prices to be higher in Monopolia or in Competitia in the short-run? In the long-run? If differences occur in his prices, would Murphy be discriminating in price?

Reference no: EM132548371

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