2.- Assume that consumers are uniformly distributed along a one-mile stretch of a beach. N ice cream vendors are pondering where to position their carts. The price that they are allowed to charge is fixed by the EACAC (Equal Access to Coolness for All Coalition). (Also, each consumer will buy exactly one ice cream.) (a) Show that there is no equilibrium (in locations) if N=3. (b) Suppose N=5 and vendors position their cart each at one of the (mile) points ( 1/6, 2/6, 3/6, 4/6, 5/6 ) is that an equilibrium?

Question

2.- Assume that consumers are uniformly distributed along a one-mile stretch of a beach. N ice cream vendors are pondering where to position their carts. The price that they are allowed to charge is fixed by the EACAC (Equal Access to Coolness for All Coalition). (Also, each consumer will buy exactly one ice cream.)

(a) Show that there is no equilibrium (in locations) if N=3.

(b) Suppose N=5 and vendors position their cart each at one of the (mile) points ( 1/6, 2/6, 3/6, 4/6, 5/6 ) is that an equilibrium?

Expert Answer

1 Rating

Want to see the step-by-step answer?

Check out a sample Q&A here.

Want to see this answer and more?

Experts are waiting 24/7 to provide step-by-step solutions in as fast as 30 minutes!*

*Response times may vary by subject and question complexity. Median response time is 34 minutes for paid subscribers and may be longer for promotional offers.
Tagged in
Business
Economics

Microeconomics

Related Economics Q&A

Find answers to questions asked by students like you.

Q: 1. Draw how the burden of the tax is distributed under the following scenarios: a) Inelastic demand ...

A: a) Inelastic demand and elastic supply:In this case, the initial equilibrium is at e at price P and ...

Q: hey can i get some help with this homework question

A: Click to see the answer

Q: Which of the following would both make the interest rate on a bond higher than otherwise?   a. ...

A: Bonds are defined as long term debt which is exclusively been provided by the company to generate fu...

Q: Question 15 Consider the following figure (The following is a description of the figure: it shows a ...

A: The process of production is the combining of the raw materials and the skills and knowledge of the ...

Q: In a particular market, the supply is elastic and demand is inelastic. If a tax is imposed on the se...

A: In the graph the initial equilibrium is at E where D intersects with S and the equilibrium price is ...

Q: What is number 7a-7d? I'm confused

A: George has charged at a $34 to each customer on account of marginal revenue ($18) that would exceed ...

Q: MonopolistRefer to the table. What is the monopolist's profit-maximizing level of output?    ...

A: Click to see the answer

Q: Explain some reasons why consumption spending and gross private domestic investment spending are so ...

A: GDP (Gross Domestic Product): It refers to the total of market value of all produced final goods and...

Q: What is profit maximizing output?

A: The profit maximizing output is determined by equating marginal revenue with marginal cost.The profi...

Q: 4:21 lLTE Work IU-12 10. "Market power" refers to a firm's ability to: 11. If a firm collects $80 in...

A: 10.  Market power is when a firm can control the price in the market without affecting its demand ma...

Q: Economic fluctuations I The following graph shows the economy in long-run equilibrium at the ex...

A: Here, with the stock market boom, the consumers/households become wealthier and starts consuming mor...

Q: How did sectarian violence influence the shaping of some parts of the West?

A: The sectarian violence is also known as the sectarian strife and this was inspired from the sectaria...

Q: Using the aggregate demand and aggregate supply model, explain the effects of the following on price...

A: Click to see the answer

Q: What happens to each sector of the economy when recession occurs?

A: The recession can be defined as a phase in the business cycle which characterised by a general slowd...

Q: Saved Help Save&Exit Submit Quantity Supplied Quantity Price Demanded $6 300 $1 10 250 $2 50 180 $3 ...

A: If there is no tax, the market will sell the product at the equilibrium price.

Q: Suppose that you, Jennifer, and Yixiu constitute the market for CDs. Your demand for CDs is illustra...

A: It is given that the market demand for CD’s comprise of three individuals:You depicted from D1,Jenni...

Q: Suppose the price of gasoline increases 10% and quantity of gasoline demanded in Orlando drops 5% pe...

A: The elasticity of demand is the responsiveness from the part of the consumer towards the price chang...

Q: What are the main causes of inefficiency in most firms? Should firms use accounting profits or econo...

A: The main causes of inefficiency in firms are:1. Poor leadership is a major factor which causes ineff...

Q: According to the Australian Wool Innovation, severe drought conditions in Australia contributed to t...

A: We are authorized to answer three subparts at a time, since you have not mentioned which part you ar...

Q: Suppose that Timmy lives in a neighborhood where graffiti is common. People's cars and the sides of ...

A: Externalities occur when the action(s) of an individual or a firm affects other individuals/firms an...

Q: Number 6a, 6b, 6c

A: a.There are two firms for the production of the airplane and the payoffs of the players are given. F...

Q: Using the aggregate demand and aggregate supply model, explain the effects of the following on price...

A: The AD-AS framework explains the relationship between price level and output produced in the economy...

Q: Instructions: Enter your answers as whole numbers.  A) What are the equilibrium price level and the ...

A: (A)The above given situation of a hypothetical economy can be depicted from the below graph:

Q: i just need help with the last three questions (finding ATC) NOT the first three. I asked this quest...

A: a.AFC per poster, if she prints 1,000 posters=100/1000=0.1AFC per poster, if she prints 2,000 poster...

Q: Firms A and B are contemplating whether or not to invest in R&D. Each has two options: “Invest” ...

A: Given information,The probability of investment that will invent product X is 0.5.Investment cost  =...

Q: Which of the following in the market is now modeled in static and dynamic frameworks, and estimates ...

A: Competition that too perfect competition is now modelled in static and dynamic frameworks, and estim...

Q: Suppose in a year an American worker can produce 100 shirts or 20 computers, while a Chinese worker ...

A: A Production Possibility Curve (PPC) is a graph that shows all the possible combinations of two comm...

Q: What is the price elasticity of demand at any point on a perfectly inelastic demand curve?

A: The price elasticity of demand measures the percentage change in quantity demanded due to percentage...

Q: The United Kingdom (UK) held a national referendum (vote) on whether the UK should remain in the Eur...

A: The Brexit will have serious implications in terms of reduced trade of goods due to increased barrie...

Q: 2. What happens to the amount of deadweight loss as a tax increases? Explain and use supply/demand d...

A: Hey, Thank you for the question. According to our policy we can only answer 1 question per session. ...

Q: What are holding costs and why is it important to manage them?

A: The holding costs are one of the categories of the costs associated with the firm. it is the cost wh...

Q: A company has an investment project that would cost $10 million today and yield a payoff of $15 mill...

A: The breakeven interest rate is the maximum rate of interest a firm can make the payments from the av...

Q: 4:21 lLTE Work 13. In the Nash equilibrium of a prisoner's dilemma: 14. Suppose Acme and Mega produc...

A: Prisoner’s dilemma is a two criminals’ game and the outcome depends on the simultaneous decisions th...

Q: Question 28 Consider a firm with production function f(L,K)=3L1/3K2/3. Assume that capital is fixed ...

A: The average fixed cost (AFC) is determined by taking the ratio of total fixed cost with the total ou...

Q: PROBLEM 11:   Demand and supply for a good are given as Qd = 100 - 2P and Qs = -8 + P, respectively ...

A: Given :Qd = 100 - 2PQs = -8 + PIn perfectly competitive market, the market demand will be equal to t...

Q: Given the following diagram, what is the own-price elasticity of supply between points A and B? P S ...

A: The price elasticity of supply is the degree of responsiveness from the part of the producers toward...

Q: Now suppose people who had been seeking jobs become discouraged, and give up their job searches. The...

A: Click to see the answer

Q: An individual consumes two goods, clothing and food. Given the information below, illustrate the Eng...

A: The Engel curve represents the relation between the income of the household and the expenditure for ...

Q: Can you help me with 4 and 5

A: At socially optimal level, output is produced at a point where price equals marginal cost. 

Q: What is the difference between demand- pull and cost-push inflation? Discuss two mechanisms that off...

A: Inflation refers to a rise in the general price level over a period of time. It results in a decreas...

Q: The use of "green" pesticide production practices while environmentally desirable, raises the margin...

A: Demand: It refers to the quantity of a commodity that consumer is willing and able to purchase at gi...

Q: b.Explain the Short Run Aggregate Supply curve and the assumptions that support its shape. List the ...

A: Click to see the answer

Q: Complete the following table and answer the short discussion question Marginal Cost (MC) Total Outpu...

A: The total fixed cost (TFC) is the cost incurred when the output production is zero. Therefore, at ze...

Q: What are the major characteristics of a firm competing under conditions of monopoly?

A: Some important characteristics of monopoly market are listed as follows. 

Q: Economics Question

A: A public good is a commodity or service provided to society without the motive of earning profit. Th...

Q: Economists use labor-market data to evaluate how well an economy is using its most valuable resource...

A: The unemployment rate is the percentage of unemployed people among the total labor force.

Q: The statement that total sales by businesses were up 0.3 percent means that GDP​ ______ because​ ___...

A: Gross Domestic Product (GDP):It is the primary indicator which shows the health of an economy. It de...

Q: Illustrate how changes in investment (or other components of total spending) can increase or decreas...

A: Multiplier – Multiplier means that a change in economic factor leads to a change in another economic...

Q: Figures 1 and 2 below show the existing cross sections at station 0+00 and 1+00. Figure 3 shows the ...

A: Hey, Thank you for the question. According to our policy we can only answer up to 3 subparts per ses...