(14.19) Consider two neighboring wineries in fierce competition over the production of their specialty wine (where their grapes come from the same vineyard, so we assume that their wines are regarded as identical by customers). One winery is owned by Jill(J), and the other by Ray (R). Each winery produces its wine the same way and have symmetric TC function TC;(q;) = 3 + 0.5g;. Inverse market demand for wine is p = 50 – 2(qj + qr). - If the firms compete la Cournot, what is each winery's equilibrium output and price? O (5.5, $10) (8.25, $17) O (4.25, $12) (6.75. $8)
Q: 7. The Stata data set "college gpa" has data on students' college GPAS, high school GPAS, ACT…
A: The answer is as follows:-
Q: A. (CHAPTER 6) Suppose there are two islands. The total population on the two islands is 800 people.…
A: Introduction Suppose there are two island. The total population on two island is 800 people. a)…
Q: Hyperinflation is extremely rare in countries where the Central Bank is independent of the rest of…
A: The answer is as follows:-
Q: When the government engages in expansionary fiscal policy there is a. a budget deficit and increase…
A: Fiscal policy is defined as a policy which is undertaken by the government of a country to influence…
Q: Choose one theory of economic development and draw/graph/write an economic model that described this…
A: When we consider the production possibility curve then it can be used in the condition where…
Q: The average consumer at a firm with market power has an inverse demand function of P 10 - Q. The…
A: A firm engages in two-part pricing charges two prices, i.e., per unit price and fixed fee. Per…
Q: If a perfectly competitive firm is producing at the output level where marginal revenue is equal to…
A: A perfectly competitive firm is a price taker, which means it takes the price set by the market…
Q: Graphically illustrate the productive optimum outcome of a cocoa producer. с. d. Discuss three…
A: Economies of scale is essentially a measure of the efficiency of production. It is the process of a…
Q: Technology A uses 3 units of labour and 6 units of capital to produce 10 units of output. •…
A: In economics, a production function gives the technological relation between quantities of physical…
Q: The Impact of a large decline in demand in perfect completion in the short-run is this: a. Price…
A: What does it mean to have a market that is completely competitive? There are no monopolies under a…
Q: 13 For bungee to be a valid proxy for riskaverse, it must be Uncorrelated with the error term…
A: Note: We will answer the first question as the exact one was not specified. Please resubmit the new…
Q: #H
A: Price elasticity of demand measures the responsiveness of change in quantity demand to change in…
Q: Consider the following. Demand Function Quantity Demanded 242 + 2 p = x = 3 Find the price…
A: Elasticity of demand is defined as type responsiveness of the quantity demand when price of the…
Q: Find the DWL of a duopoly and of monopoly if firms have MC(q) = q, and face demand D(p) = 320 − 4p.
A:
Q: For each price in the following table, calculate thé tirm's optimal quantity 8F UHILS quantity,…
A: Shutdown price is the minimum price a business need to justify remaining in the market in the…
Q: #6
A: Oligopoly is a form of market structure in which there are few large sellers for a homogeneous or…
Q: 1. CLARA is a producer in a monopoly industry. Her demand curve, total revenue curve, marginal…
A: P = 40 - Q [or, Q=40-P] TR = 40Q - Q² MR = 40 - 2Q , TC = 20 + Q² MC = 20
Q: 1. A firm has estimated that the fixed costs of operations for a new product at $4.5M per year.…
A: Solution:- 1) Here X = break even units Here TC = 4500000 + 250X TR = 1000X break even occurs when…
Q: Amy is a chocolate lover and has a total of 50 dollars to spend this week. The price of a certain…
A: Given Utility function U(q)=q+50-pqq∈0,50PTotal budget=50Price of q=50
Q: Which of the following is an example of a command and control policy to address an externality? O…
A: The benefit or costs that are caused by a producer that is not being received or incurred…
Q: Suppose that real GDP is currently $97 billion per year and natural real GDP is currently $100…
A: The given information: Real GDP = $97 billion Natural GDP = $100 billion
Q: Why are telecom industries across different onomies in the world in general oligonolie
A: An oligopoly is a market structure in which a market or industry is overwhelmed by few venders,…
Q: Predict what each of the following events would do to the terms of trade of the importing country…
A:
Q: Are the following statements true or false? Select the best answer. Statement 1: Allocative…
A: Productivity and allocative efficiency is achieved in Perfect competition market structure.…
Q: 1. A firm has estimated that the fixed costs of operations for a new product at $4.5M per year.…
A: We will answer the first question since the exact one was not specified. Please submit a new…
Q: Suppose the government forces the price to be above the equilibrium. Is this called a price floor…
A: Price control refers to the form of government interference in the free market to influence the…
Q: culate the inflation rate in sudan where the CPI in 2021 was 100 and CPI in 2021 is 150?
A: Inflation is the rate at which the value of a currency is falling and, consequently, the general…
Q: (c) Long-run average total cost curve is a curve that shows the lowest (Unit) cost at which the firm…
A:
Q: ! Thank you.
A: Given: B=0
Q: The amount of money paid for the use of borrowed capital or from the money that has been loaned ОА.…
A: Borrowed capital consists of money that is borrowed and utilised to create an investment. It varies…
Q: Homer owns 100% of the common and preferred shares in Homer's Recreation Inc.(HRI). HRI signed a…
A: Because the boat loan agreement is between HRI and the boat loan firm, the boat loan company could…
Q: When the exchange rate rises, the demand curve for foreign exchange shifts and the supply curve of…
A: DISCLAIMER “Since you have asked multiple question, we will solve the first question for you. If…
Q: CONSOL Energy purchased a new continuous miner to mine coal in one of their underground coal mines…
A: Depreciation of new continuous miner using MACRS is calculated below:
Q: VC FC TC AVC AFC АТС 0.00 3,780.00 NA NA NA 1 400.00 2 700.00 3 900.00 4 1,000.00 1,050.00 6.…
A: *Answer: For a firm in perfect competition, the supply curve is given by Price = Marginal Cost So…
Q: Which of the following would be part of an organization's efforts to engage in differentiation? a.…
A: Large companies or organizations often engage in differentiation strategies in order to gain…
Q: Governor Mitch Daniels advocates that the government intervene less in business to promote jobs and…
A: Supply-side Economics The macroeconomic view of supply-side economics is conservative and…
Q: Increasing the number of neighbours each case is matched to tends to have which effects on estimates…
A: Standard error reflects how much the population mean differs from the sample mean. It indicates how…
Q: Instructions: Round your responses to one decimal place. If you are entering any negative numbers be…
A: The rate of inflation is nothing but the rate of change in the consumer price index. inflation…
Q: The price of haircuts increased by 8%, and the quantity demanded for haircuts decreased by 4%. From…
A: Price elasticity of demand measures the responsiveness of change in quantity demand to change in…
Q: Consider this economy: C = 100 + 0.5Y 1= 400 + 0.1Y Drag and drop options on the right-hand side and…
A: At equilibrium, aggregate output is equal to the sum of consumption, investment and government…
Q: Lynn owns a tutoring center that supplies SAT and ACT test preparation service for high school…
A: Market power refers to the ability of the firm to influence the market. It is possible to interpret…
Q: a) The production function q = 9KO.8LO.1 exhibi [ increasing returns to scale, constant return to…
A: Increasing returns to scale occurs when the output increases by a larger proportion than the…
Q: Suppose the economy's production function is Y = AKO.3NO.7. If K=2000, N = 100, and A = 1, then…
A: Production Function, Y = AK0.3 N0.7K = 2000N = 100A = 1Y = 246
Q: Eideas signed a contract to lease a building at P60,000 a year with an annual increase of P1,000 a…
A: Starting lease payment = P60,000 Annual increase in lease payment = P1,000 Worth of money = 8% Time…
Q: Question 19 12 11 10 9 6 4 3 1 10 20 30 40 50 60 70 80 90 100 110 120 2 The go ent imposes a $3 tax.…
A: Consumer surplus is the area above the market price and below the demand curve up to equilibrium…
Q: The owner of a cemetery plans to offer a perpetual care service for grave sites. The owner estimates…
A: The correct answer is given in the second step.
Q: how can we reduce carbon emission in the transport sector?
A: Externalities are circumstances in which the impact of producing or consuming products and services…
Q: Show the complete solution. The final answer is already provided. Q3. Edeas signed a contract to…
A: The PV of the cash flow is the present worth of a cash flow at a particular rate of interest and…
Q: 1. In the year 1980, when Thatcher came to power in UK, inflation was .. and unemployment rate was…
A: UK inflation as per official data was 18 % in 1980 Uk Unemployment data
Q: B. Determine the inflation rate of Country ABC using its CPI from 2020 and 2021. Price 2021 Price…
A: Total price of the commodities in 2021 = 105,500 Total price of the commodities in 2020 = 113,500…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- PC Connection and CDW are two online retailers that compete in an Internet market for digital cameras. While the products they sell are similar, the firms attempt to differentiate themselves through their service policies. Over the last couple of months, PC Connection has matched CDW’s price cuts but has not matched its price increases. Suppose that when PC Connection matches CDW’s price changes, the inverse demand curve for CDW’s cameras is given by P = 1,500 − 3Q. When it does not match price changes, CDW’s inverse demand curve is P = 900 − 0.50Q. Based on this information, determine CDW’s inverse demand and marginal revenue functions over the last couple of months. Over what range will changes in marginal cost have no effect on CDW’s profit-maximizing level of output?The figure below shows the market conditions facing two firms, Brooks, Inc., and Spring, Inc., in the domestic market for large utility pumps. Each firm has constant long-run costs, so that MC0 = AC0. As competitors in a duopoly, there are a number of models to determine output and prices. Assume that the Bertrand duopoly model applies, so that they both set price equal to their marginal cost. Initial output in this market will be 16,000 per year (this is split between the two firms), at a price of $300. (a) At the initial equilibrium, what is total surplus (consumer surplus plus producer surplus)? Suppose that Brooks, Inc. and Spring, Inc. form a joint venture, River Company, whose utility pumps replace the output sold by the parent companies in the domestic market. Assuming that River Company operates as a monopolist and that its costs equal MC0 = AC0, what is: (b) The price? (c) The output? (d) Total profit? (e) The resulting deadweight loss from River Company operating as a…The figure below shows the market conditions facing two firms, Brooks, Inc., and Spring, Inc., in the domestic market for large utility pumps. Each firm has constant long-run costs, so that MC0 = AC0. As competitors in a duopoly, there are a number of models to determine output and prices. Assume that the Bertrand duopoly model applies, so that they both set price equal to their marginal cost. Initial output in this market will be 16,000 per year (this is split between the two firms), at a price of $300. Suppose that Brooks, Inc. and Spring, Inc. form a joint venture, River Company, whose utility pumps replace the output sold by the parent companies in the domestic market. Assuming that River Company operates as a monopolist and that its costs equal MC0 = AC0, what is: (b) The price?
- The figure below shows the market conditions facing two firms, Brooks, Inc., and Spring, Inc., in the domestic market for large utility pumps. Each firm has constant long-run costs, so that MC0 = AC0. As competitors in a duopoly, there are a number of models to determine output and prices. Assume that the Bertrand duopoly model applies, so that they both set price equal to their marginal cost. Initial output in this market will be 16,000 per year (this is split between the two firms), at a price of $300. Suppose that Brooks, Inc. and Spring, Inc. form a joint venture, River Company, whose utility pumps replace the output sold by the parent companies in the domestic market. Assuming that River Company operates as a monopolist and that its costs equal MC0 = AC0, what is: (e) The resulting deadweight loss from River Company operating as a monopoly?The figure below shows the market conditions facing two firms, Brooks, Inc., and Spring, Inc., in the domestic market for large utility pumps. Each firm has constant long-run costs, so that MC0 = AC0. As competitors in a duopoly, there are a number of models to determine output and prices. Assume that the Bertrand duopoly model applies, so that they both set price equal to their marginal cost. Initial output in this market will be 16,000 per year (this is split between the two firms), at a price of $300. Suppose that Brooks, Inc. and Spring, Inc. form a joint venture, River Company, whose utility pumps replace the output sold by the parent companies in the domestic market. Assuming that River Company operates as a monopolist and that its costs equal MC0 = AC0, what is: (c) The output? (d) Total profit?Three firms, A, B and C engage in Bertrand price competition in a market with inverse demand given by P = 123 − 2Q. Whenever a firm undercuts the rivals’ price, it gets the entire demand. If firms charge the same lowest price in the market, they share the market. If a firm charges a price more than any rival, it has zero market share. Suppose there are no fixed costs, and the marginal costs of the firms are: c(A) = 91, c(B) = 83 and c(C) = 43. Find a Nash equilibrium of this game. What are each firm’s prices and profits? Explain solution. Suppose firm B leaves the market. Draw each firm’s best response on a diagram and find a Nash equilibrium of this duopoly game. Suppose the above game in part 2 between firms A and C was the stage game of an infinitely repeated game. Would it be possible for the two firms to collude or form a cartel in this case?
- Suppose that two Japanese companies, Hitachi and Toshiba, are the sole producers (i.e., duopolists) of a microprocessor chip used in a number of different brands of personal computers. Assume that total demand for the chips is fixed and that each firm charges the same price for the chips. Each firm’s market share and profits are a function of the magnitude of the promotional campaign used to promote its version of the chip. Also assume that only two strategies are available to each firm: a limited promotional campaign (budget) and an extensive promotional campaign (budget). If the two firms engage in a limited promotional campaign, each firm will earn a quarterly profit of $14 million. If the two firms undertake an extensive promotional campaign, each firm will earn a quarterly profit of $11 million. With this strategy combination, market share and total sales will be the same as for a limited promotional campaign, but promotional costs will be higher and hence profits will be lower.…Three firms, A, B and C engage in Bertrand price competition in a market with inverse demand given by P = 123 − 2Q. Whenever a firm undercuts the rivals’ price, it gets the entire demand. If firms charge the same lowest price in the market, they share the market. If a firm charges a price more than any rival, it has zero market share. Suppose there are no fixed costs, and the marginal costs of the firms are: c(A) = 91, c(B) = 83 and c(C) = 43. a. Find a Nash equilibrium of this game. What are each firm’s prices and profits? Explain your solution. b. Suppose firm B leaves the market. Draw each firm’s best response on a diagram and find a Nash equilibrium of this duopoly game. c. Suppose the above game in part b between firms A and C was the stage game of an infinitely repeated game. Would it be possible for the two firms to collude or form a cartel in this case? "Economic "Three firms, A, B and C engage in Bertrand price competition in a market with inverse demand given by P = 123 − 2Q. Whenever a firm undercuts the rivals’ price, it gets the entire demand. If firms charge the same lowest price in the market, they share the market. If a firm charges a price more than any rival, it has zero market share. Suppose there are no fixed costs, and the marginal costs of the firms are: c(A) = 91, c(B) = 83 and c(C) = 43. a. Find a Nash equilibrium of this game. What are each firm’s prices and profits? Explain your solution. b. Suppose firm B leaves the market. Draw each firm’s best response on a diagram and find a Nash equilibrium of this duopoly game. c. Suppose the above game in part b between firms A and C was the stage game of an infinitely repeated game. Would it be possible for the two firms to collude or form a cartel in this case?.
- You are the manager in a market composed of eight firms, each of which has a 12.5 percent market share. In addition, each firm has a strong financial position and is located within a 100-mile radius of its competitors. a. Calculate the premerger Herfindahl-Hirschman index (HHI) for this market. b. Suppose that any two of these firms merge. What is the postmerger HHI? c. Based only on the information contained in this question and on the Horizontal Merger Guidelines described in this chapter, do you think the Justice Department (or FTC) would attempt to block a merger between any two of the firms? ExplainSuppose the market demand for ECO textbooks at the University is given by ?=1000−2?Q=1000−2P. The Marginal Cost of a textbook is $50. Suppose there are only two textbook publishers, both printing the exact same textbook. They compete in a Cournot manner. Suppose each firm produces ?=450q=450. Is this an equilibrium? Explain your reasoning, show all the steps of your working clearly. Keep your responses short and precise. Under 250 words is a good rule of thumb.The Able Manufacturing Company and Better Bettors, Inc. are rival firms in the production of a calculator used by horse racing fans for handicapping (determining betting strategies). Each firm has a fixed cost of $100 and a MC = $10 in producing calculators. The demand for the industry’s product is: Q = 900 – 5P, where P is the market price and Q = Q1 + Q2. If each firm must choose how many calculators to produce and sell without knowing of its rival’s production decision, what will be the Cournot equilibrium price and quantities produced? Calculate the profit for each firm.