Suppose that there are only two small countries in the world: ascot, with a population of 37 comma 500 people, and delwich, with a population of 25 comma 000 people. ascot's gdp is equal to $160 million while delwich's gdp is $256 million. delwich's gnp has been estimated to be equal to $276 million. the revenue earned by firms that operate in delwich but are headquartered in ascot is equal to $40 million.

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Business

Jace Richards

16 February, 09:26

Suppose that there are only two small countries in the world: ascot, with a population of 37 comma 500 people, and delwich, with a population of 25 comma 000 people. ascot's gdp is equal to $160 million while delwich's gdp is $256 million. delwich's gnp has been estimated to be equal to $276 million. the revenue earned by firms that operate in delwich but are headquartered in ascot is equal to $40 million.

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Corbin Hendrix · Answer 1

Answer: The price of the tied good is $27.

Explanation: The practice of tying is used to package products in such a way that the price of the tied (combined) good is closer to the buyers total willingness to pay for the two goods.

In this case, the total willingness to pay of Carnivore is $20+$7=$27

While, that of Leafygreens is $8+$12=$20

Thus, the producer will sell the combined good at $27 as it will give him more revenue.