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In the astrology market there are n astrologers offering the telephone service "I can read your stars", whose demand can be represented by the function Q = 1000 – 2p, where Q is the number of calls and p the price of each call (we assume all calls last the same amount of time and they have a fixed price). Marginal costs per calls of each fortune teller are identical and constant, c = 1. Consumers perceive all astrologers as having the same reliability as they all look at the stars with their own eyes. Thus, consumers will consult the astrologer offering the lowest price. If all astrologers offer their service at the same price they share the market equally. Calculate the price, and the total number of astrologers in the market if the competition among astrologers takes place 'a la Bertrand. (a) p = 0.9; Q = 998. (b) p = 1; Q = 990. (C) p = 1.5; Q = 997. (d) All the other solutions are wrong. Astrologer A have hear of a brilliant astronomer named Galileo who is about to be killed for reasons too long to be explained here. Galileo has a telescope that is willing to sell in order to ensure the well-being of his wife and daughter, With the telescope astrologer A will have a much better view of the sky and its stars and her predictions will be infallible beating any other astrologer every time and becoming the unique astrologer in the market. Let us denote by F the maximum value astrologer A will be willing to pay for the (unique and never to be repeated given the current circumstances) telescope. The value of F for astronomer A is: (a) F = Ó (b) F = (499) /2 (c) F = (499)^2/ 2 (d) All the other solutions are wrong. %3D

In the astrology market there are n astrologers offering the telephone service "I can read your stars", whose demand can be represented by the function Q = 1000 – 2p, where Q is the number of calls and p the price of each call (we assume all calls last the same amount of time and they have a fixed price). Marginal costs per calls of each fortune teller are identical and constant, c = 1. Consumers perceive all astrologers as having the same reliability as they all look at the stars with their own eyes. Thus, consumers will consult the astrologer offering the lowest price. If all astrologers offer their service at the same price they share the market equally. Calculate the price, and the total number of astrologers in the market if the competition among astrologers takes place 'a la Bertrand. (a) p = 0.9; Q = 998. (b) p = 1; Q = 990. (C) p = 1.5; Q = 997. (d) All the other solutions are wrong. Astrologer A have hear of a brilliant astronomer named Galileo who is about to be killed for reasons too long to be explained here. Galileo has a telescope that is willing to sell in order to ensure the well-being of his wife and daughter, With the telescope astrologer A will have a much better view of the sky and its stars and her predictions will be infallible beating any other astrologer every time and becoming the unique astrologer in the market. Let us denote by F the maximum value astrologer A will be willing to pay for the (unique and never to be repeated given the current circumstances) telescope. The value of F for astronomer A is: (a) F = Ó (b) F = (499) /2 (c) F = (499)^2/ 2 (d) All the other solutions are wrong. %3D

Principles of Economics 2e
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter9: Monopoly
Section: Chapter Questions
Problem 1SCQ: Classify the following as a government-enforced barrier to entry, a banker to entry that is not...
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In the astrology market there are n astrologers offering the telephone service "I can read your stars", whose demand can be represented by the function Q = 1000 – 2p, where Q is the number of calls and p the price of each call (we assume all calls last the same amount of time and they have a fixed price). Marginal costs per calls of each fortune teller are identical and constant, c = 1. Consumers perceive all astrologers as having the same reliability as they all look at the stars with their own eyes. Thus, consumers will consult the astrologer offering the lowest price. If all astrologers offer their service at the same price they share the market equally. Calculate the price, and the total number of astrologers in the market if the competition among astrologers takes place 'a la Bertrand. (a) p = 0.9; Q = 998. (b) p = 1; Q = 990. (c) p = 1.5; Q = 997. (d) All the other solutions are wrong. Astrologer A have hear of a brilliant astronomer named Galileo who is about to be killed for reasons too long to be explained here. Galileo has a telescope that is willing to sell in order to ensure the well-being of his wife and daughter, With the telescope astrologer A will have a much better view of the sky and its stars and her predictions will be infallible beating any other astrologer every time and becoming the unique astrologer in the market. Let us denote by F the maximum value astrologer A will be willing to pay for the (unique and never to be repeated given the current circumstances) telescope. The value of F for astronomer A is: (a) F = 0 (b) F = (499) /2 (c) F = (499)^2/ 2 (d) All the other solutions are wrong. %3D
Transcribed Image Text:In the astrology market there are n astrologers offering the telephone service "I can read your stars", whose demand can be represented by the function Q = 1000 – 2p, where Q is the number of calls and p the price of each call (we assume all calls last the same amount of time and they have a fixed price). Marginal costs per calls of each fortune teller are identical and constant, c = 1. Consumers perceive all astrologers as having the same reliability as they all look at the stars with their own eyes. Thus, consumers will consult the astrologer offering the lowest price. If all astrologers offer their service at the same price they share the market equally. Calculate the price, and the total number of astrologers in the market if the competition among astrologers takes place 'a la Bertrand. (a) p = 0.9; Q = 998. (b) p = 1; Q = 990. (c) p = 1.5; Q = 997. (d) All the other solutions are wrong. Astrologer A have hear of a brilliant astronomer named Galileo who is about to be killed for reasons too long to be explained here. Galileo has a telescope that is willing to sell in order to ensure the well-being of his wife and daughter, With the telescope astrologer A will have a much better view of the sky and its stars and her predictions will be infallible beating any other astrologer every time and becoming the unique astrologer in the market. Let us denote by F the maximum value astrologer A will be willing to pay for the (unique and never to be repeated given the current circumstances) telescope. The value of F for astronomer A is: (a) F = 0 (b) F = (499) /2 (c) F = (499)^2/ 2 (d) All the other solutions are wrong. %3D
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