Explains it correctly Three firms are bidding for the rights to provide cable television services. Thedemand for cable television is given by the equation P=100-Q. Firm 1 has an averagecost of AC¹ =10, Firm 2 has an average cost of AC2= 20, and Firm 3 has an averagecost of AC3 =30. If the rights are awarded using an English auction, approximatelywhat is the resulting price and quantity of services provided?A. P= 10; Q = 90.B. P = 20; Q = 80.C. P = 30; Q = 70.D. P= 20; Q = 90.E. P= 10; Q = 80.

Demand function : P = 100 - Q Firm 1 AC : AC1 = 10 Total Cost = 10 Q Firm 2 AC : AC 2 = 20 TC =…

Bidding for the rights to provide cable television services. The demand for cable television is given by the equation P - 100 -Q. Firm 1 has an average cost of AC! 10, Firm 2 has an average cost of AC? = 20, and Firm 3 has an average cost of ACS = 30. If the rights are awarded using an English auction, approximately what is the resulting price and quantity of services provided? A. P= 10; Q = 90. B. P= 20; Q = 80. C. P= 30; Q = 70. D. P= 20; Q = 90.

Bidding for the rights to provide cable television services. The demand for cable television is given by the equation P - 100 -Q. Firm 1 has an average cost of AC! 10, Firm 2 has an average cost of AC? = 20, and Firm 3 has an average cost of ACS = 30. If the rights are awarded using an English auction, approximately what is the resulting price and quantity of services provided? A. P= 10; Q = 90. B. P= 20; Q = 80. C. P= 30; Q = 70. D. P= 20; Q = 90.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter8: Game Theory

Section: Chapter Questions

Problem 8.4P

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Three firms are bidding for the rights to provide cable television services. The demand for cable television is given by the equation P=100-Q. Firm 1 has an average cost of AC1 = 10, Firm 2 has an average cost of AC2 = 20, and Firm 3 has an average cost of AC3 = 30. If the rights are awarded using an English auction, approximately what is the resulting price and quantity of services provided? (A). P= 10; Q = 90. (B). P = 20; Q = 80. (C). P = 30; Q = 70. (D). P = 20; Q = 90. (E). P = 10; Q = 80.
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