For the case of an industry that you know well, describe the extent to which firms in that industry are open to competition from international
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For the case of an industry that you know well, describe the extent to which firms in that industry are open to competition from international
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- Why is product differentiation by itself in capable of explaining intra-industry trade why does the explanation of intra- industry trade require both product differentiation and economies of scaleThe table below presents the industry output for three different industries. Firm Industry 1 Output Industry 2 Output Industry 3 Output Firm A 50 100 10 Firm B 50 0 10 Firm C 50 0 10 Firm D 0 0 10 All other firms 0 0 100 Instructions: Round your answers to two decimal places. a. Calculate the four-firm concentration ratio for each industry. Industry 1: % Industry 2: % Industry 3: % b. Based on the information provided, what market structure best characterizes each industry? Industry 1: Industry 2: Industry 3:A large share of the world supply of diamonds comes from Russia and South Africa. Suppose that the marginal cost of mining diamonds is constant at $1,000 per diamond, and the demand for diamonds is described by the following schedule: Price ($) Quantity (diamonds) 8000 5000 7000 6000 6000 7000 5000 8000 4000 9000 3000 10000 2000 11000 1000 12000 a) If there were many suppliers of diamonds, what would be the price and quantity? b) If there were only one supplier of diamonds, what would be the price and quantity? c) If Russia and South Africa formed a cartel, what would be the price and quantity? If the countries split the market evenly, what would be South Africa’s production and profit? What would happen to South Africa’s profit if it increased its production by 1,000 while Russia stuck to the cartel agreement? d) Use your answers to part (c) to explain why cartel agreements are often not successful.
- Considering the competitive landscape in China, India, and Latin America, how can home-grown firms best defend and win against large multinational entrants?A country is the only production site in the world for "hyperhoney infinite pasta", a wonderful product produced using a delicate, highly perishable extract obtainable from some trees that grow only in this country. Beyond a very small size, there are no internal or external scale economies at present. Furthermore, there is no domestic demand for this product in the country, so all production will be exported. The country’s government has the choice of forming the pasta-producing industry either as a monopoly or as a large number of small pasta producers that will act as perfect competitors. What is your advice to the country’s government about which market structure to choose for the pasta industry? Why?_______ Because it has not been around long enough toestablish itself, the Russian automobile industrycould be classified as a(n)a. hopeless industry.b. soft industry.c. infant industry.d. protected industry.e. toddler industry
- The table represents the market share of the 10 largest steel producers. Firm Market Share (%) 1 21.2 2 18.2 3 14.0 4 12.0 5 8 6 7.5 7 6.4 8 5 9 4 10 1 What is the four‑firm concentration ratio for the steel industry represented in the table? Round your answer to the nearest tenth.What are the main factors that made Xiaomi a leading smartphone company in China and What do competitive reaction do you expect from Samsung and Apple globally?Evaluate the following statements.10. (4) Why would you expect sellers of branded goods with high upfront research and development costs to be more interested in free trade than producers who do not incur any fixed costs? 11. (8) Focus attention on the Ricardian model, the Heckscher-Ohlin model, and the monopolistic competition model if trade. Consider the intra-industry trade index for each model. What value for the index does each models predict? Explain your answer.
- Which of the following explains intra-industry trade? a. Wrong industrial classification b. All of the above c. Product differentiation d. Economies of scaleAn environmental regulation results in the closing down of many firms in an industry, leaving just two or three dominant firms. How might this affect the long-run costs of the regulation?Two car manufacturers, Saab and Volvo, have fixed costs of $1 billion and marginal costs of $15,000 per car. If Saab produces 500,000 cars per year and Volvo produces 200,000 cars per year, calculate the average production cost for each company. Average production cost for Saab: $ __ .Average production cost for Volvo: $ __ .On the basis of these costs, which company's market share do you think will grow in relative terms?
