QUESTION 7 In the hotelling model, suppose firm 2 locates at 45 meters. Which of the following location choices for firm 1 gives highest profits? O 50 meters O 49 meters O 44 meters
Q: In the hotelling model, suppose firm 2 locates at 25 meters. Which of the following location choices…
A: In Hotelling's Location Model, firms do not exercise variations in product characteristics; firms…
Q: So (voluntarily) intericated that be is not aware of the consequences of his actions, Umberto agrees…
A: Intoxication is a state in which one's physical or mental control has been significantly weakened by…
Q: The inverse Demand equation is: P = 1018 - 1.5 Q The marginal cost is given as: MC = 212 + 1.5 Q if…
A: When the market is served by many competitive firms, each firm has no market power.
Q: The term 'random walk' is used in investments to refer to O A. stock price changes that are random…
A: An asset that is being created with the sole intention of growing money in the future is known as…
Q: What is the minimum bonus that will entice high effort? O 1.40,000 O 2. 260,000 O 3. 300,000 O 4.…
A: The minimum bonus should be the cost of high effort.
Q: Table 7-4 The numbers in Table 7-1 reveal the maximum willingness to pay for a ticket to a Chicago…
A: Willingness to pay is the maximum price at or below which a consumer will definitely buy one unit of…
Q: Consider a market demand function P=100-0.01Q. There are only two firms in the market and each…
A: When there is no first-mover, both firms act as Cournot duopoly and when there is a first mover,…
Q: In Hotelling's linear location model where the linear city (location space) goes from 0 to 1, what…
A: Given That In Hotelling's linear location model where the linear city (location space) goes from 0…
Q: Nokia 10, Samsung X and iPhone 7. Suppose further that, your company currently sells 120 units of…
A: Price elasticity of demand measures the responsiveness in quantity demanded of a commodity to a…
Q: QUESTION 16 Firms A and B engage in Stackelberg competition, where p = 90 – 40. MC. = S10. MC. =…
A: Oligopoly market structure is the market structure in which there are few large firms that…
Q: Three consumers who want to buy a new car have the above valuations for dealer options. Assume costs…
A: MB(marginal benefit) alludes to the extra profit by expansion consumption or production. In…
Q: If market share for six cleaning service companies are 8%, 10%, 6%, 3%, 25%, and 48%, what would be…
A: The Herfindahl-Hirschman Index (HHI) is a commonly accepted measure of market concentration. It is…
Q: Left Centre Right Up 2/2 43 1/0 Middle 3 / 1 5/4 2/3 Down 1/3 6/2 3/4 If the game is dominance…
A: The given game can be written as :- Left Centre Right Up 1 1.33 - Middle 3 1.25 0.67 Down…
Q: Consider the following game in extensive form. A 4, 4 2 B 6, 5 7,3 C 3,7 D 3, 2 What is the payoff…
A: Using backward Induction: Player 1 has to choose between t and s given that player 2 chooses C. He…
Q: Consider an equilibrium of a single product market jointly determined by a supply function q* = a, +…
A: Given information Supply function q*=a0+a1*p*+u Demand function q*=b0+b1*p*+v q*= equilibrium…
Q: QUESTION 9 In the Bertrand model, suppose that each firm has a marginal cost of £10 and that firm 1…
A: A Bertrand model is a model in economics in which the firms use their marginal costs to set prices…
Q: Consider an equilibrium of a single product market jointly determined by a supply function q* = a, +…
A: Given, Supply function : q*=ao+a1*p*+UDemand function : q*=β0+β1*p*+Vwhere q* is the equilibrium…
Q: Indicate whether the following statement is TRUE or FALSE and explain your answer: If one player is…
A: The Statement given is TRUE. In a Stackelberg model, the leader is the player who moves first (Also…
Q: What is the payoff for player 1 in the normal form game below
A:
Q: Your company is bidding for mineral rights to a tract of land for drilling oil. Based on your…
A: Given the valuation of mineral rights = $38 million High value = $45 million Low value = $20 million…
Q: Companies should use investment entry modes whenever possible because they offer the greatest…
A: The investment entry method is the one that necessitates the most time and financial and human…
Q: Tastibite's BRF TASTIBITE'S PRICE Now suppose that in addition to differing in the amount of nuts…
A: Meaning of Product Differentiation: The term product differentiation refers to the situation under…
Q: Consider a firm with several plants that all produce the same product. Each plant's manager has much…
A: We are going to answer this question using participation constraint and incentive constraints…
Q: $70 $65 MC $60 $55 $50 $45 $40 ATC $40 $32.50 $35 $30 $25 $25 $20 "$14.30 $15 Demand $10 $5 MR…
A: Since you have posted a question with multiple sub-parts, we will solve the first three sub-parts…
Q: Teletronics reported record profits of $100,000 last year and is on track to exceed those profits…
A: Here, the salary is fixed and thus the manager's compensation will not vary with firm performance.…
Q: 4. Suppose that there is a negotiation between two players over a painting. Person 1, the seller,…
A: In-game theory, a subgame perfect equilibrium is a more advanced variation of Nash equilibrium used…
Q: What are the values of P,P2, Q1,Q2 given the two commodity demand and supply model: Qa = 18 – 3P+P Q…
A: Given Qd1=18-3P1+P2 ........(1)Qs1=-2+4P1 ......(2)Qd2=12+P1-2P2…
Q: QUESTION 4 Which game form is best suited to games with simultaneous decisions about strategy?…
A: Game theory basically refers to the basic study of how economic actors' interacting actions produce…
Q: ImaliiA UI lu IEII CUMPEILIVT IS UepiLieu iIi uiE Iiaye. What is Firm 1's dominant strategy? Firm 1…
A: While analyzing a game, dominant strategy of a firm is one that is always preferable to other…
Q: A Nash equilibrium occurs if all players in a game play their best strategies O a. given what their…
A: Nash equilibrium is achieved at a point where no player can be made better off without making others…
Q: Player A and Player B are playing a game . First , Player A chooses to either " Keep " or " Pass " .…
A: Sequential game: It is a game under which one player will make his turn after the other one will…
Q: Consider the following scenario to understand the relationship between marginal and average values.…
A: The numerical connection between average and marginal implies that the average worth is "driven" by…
Q: Suppose the two countries can trade shares in the ownership of their perspective assets. Further…
A: When good year reception , Farmer will get 75 plenty of kiwi from home and 12.5 tons from foreign…
Q: Since MC(y) is the derivative of c(y), c(y) must be the integral of MC(y). Select one: O True O…
A: Marginal cost is the additional cost incurred in producing an additional unit of a good.
Q: Newfoundland’s fishing industry has recently declined sharply due to overfish- ing, even though…
A: In the game theory, Prisoner’s dilemma is a strategic game that shows that even completely rational…
Q: (OTHER SOLUTION CONCEPTS) Consider the 4x3 game depicted below. A Г1,2 1,2 0,3] B 4,0 1,3 0,2 с 13,1…
A: Minimax strategy is when the player is minimizing one’s own maximum loss Here, player 2 minimizes…
Q: (Butterworth) Mrs. Butterworth Maple Syrup budgets its marketing efforts using competitive parity.…
A: Market share is defined as the portion of the market which is controlled by a certain good or a firm…
Q: 11. One possible strategy is that each firm produces. This gives a more Pareto efficient outcome.…
A: Hi! Thank you for the question. As per the honor code, We’ll answer the first question since the…
Q: What are the values of P, P2,Q,Q2 given the two commodity demand and supply model: Qai = 18 – 3P +…
A:
Q: A statistical study estimated that the dental appliance market coexists with a Supply curve given…
A: Supply function : O = 75.2 + 1.4P Demand Function : D = 446.2 - 1.1P Equilibrium prices in the…
Q: Table The numbers reveal the opportunity costs of providing 10 piano lessons of equal quality.…
A: The cost that one incurs when one lets go of one alternative to get another is the “opportunity…
Q: (Table 12.6) Payoffs represent profits in thousands. Fruit of the Loom T-Shirt Price $8 $6 Hanes T-…
A: A Nash equilibrium is such an outcome in which neither of the players have an incentive to change…
Q: In a typical product mix model, where a companymust decide how much of each product to produceto…
A: In terms of the product mix case, when the question of producing the number of products arise, it is…
Q: Suppose that a firm produces two outputs. The firm's profit-maximizing output levels (yĩ, 42)…
A:
Q: Consider the setup from Question 1 and 2. Sam has another idea: They buy two tickets (that have…
A: An individual will be considered as risk averse when he prefers to choose an alternative with lesser…
Q: Suppose initially there are 22 Cournot competitors in a market, each producing an identical good at…
A: Given, Number of Cournot competitors, N = 22 Each produces identical products at the same constant…
Q: QUESTION 3 Which is the correct interpretation of the dotted line between 2's decision nodes? O When…
A: In a specific game tree, one can analyze the decision of all the players based on the availability…
Q: What are payoffs of the farmers in the Nash equilibrium outcome of this scenario Both farmers earn a…
A: High Farmer 2 Low Farmer 2 High Farmer 1 23- 16 , 23-16 23-11, 15- 9 Low Farmer 1 15- 9 ,…
Q: Jin's Utility Function Wealth Utility (Dollars) 60,000 4,000 61,000 4,110 62,000 4,209 63,000 4,288…
A: We are first going to derive the properties of risk averse function to answer this question.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- ** Please be advsed that this is practice only from previous yeasr *** Answers: (a) There are no Nash equilibria.(b) There are two pure strategy Nash equilibra, one with (H,H) and another with (L,L), and no mixed strategy Nash equilibria.(c) There are two pure strategy Nash equilibra, one with (H,H) and another with (L,L), and one mixed strategy Nash equilibria with p = 1/2 and q = 1/2.(d) There are two pure strategy Nash equilibra, one with (H,H) and another with (L,L), and one mixed strategy Nash equilibria with p = 1/2 and q = 3/4.(e) There are two pure strategy Nash equilibra, one with (H,H) and another with (L,L), and one mixed strategy Nash equilibria with p = 3/4 and q = 1/2.The model initial setup is• The number of vacancies posted in the economy during a particular month is v = 100.• There were initially u = 225 unemployed workers at the beginning of the month.• Suppose that the average wage is 0.6 relative to their productivity. Unemployed workersreceive benefits that are half the wage, i.e., b = 0.3 relative to productivity.• Suppose that the number of matches between firms and workers are given by thefollowing matching functionsM = Au^0.5v^0.5• Suppose that 45 workers were able to find a job by the end of the month.Answer the following questions.a) What is the monthly job finding rate?b) What is the probability that an average vacancy is filled in a month?c) What is the job creation cost, k?d) What is the value of A?e) Explain how introducing a searching cost to this model would affect the queue length,the number of vacancy and unemployment rate, and wage.[The soft drink industry is dominated by two cola firms- DEW and HEW. The market is worth $8 billion. Each firm can decide whether to advertise or not, but advertising costs $2 billion to any firm undertaking it. Moreover, advertising will create only negligible new demand as the market is already saturated. So, for the purpose of this question, assume that the market remains at $8 billion regardless of advertising. If one firm advertises and the other does not, then the former captures the whole market. If both firms advertise, then DEW captures 60% of the market and HEW captures 40% of the market, but the advertising must be paid for. If neither firm advertises, then the market is again split 60:40, with 60% going to DEW and 40% to HEW.] [Draw the payoff matrix for this game where each player’s payoff is equal to the value of market it captures less the cost of advertisement. [Do any of the firms have dominant strategies? If so, what are they? Is there a dominant strategy…
- [The soft drink industry is dominated by two cola firms- DEW and HEW. The market is worth $8 billion. Each firm can decide whether to advertise or not, but advertising costs $2 billion to any firm undertaking it. Moreover, advertising will create only negligible new demand as the market is already saturated. So, for the purpose of this question, assume that the market remains at $8 billion regardless of advertising. If one firm advertises and the other does not, then the former captures the whole market. If both firms advertise, then DEW captures 60% of the market and HEW captures 40% of the market, but the advertising must be paid for. If neither firm advertises, then the market is again split 60:40, with 60% going to DEW and 40% to HEW.] Draw the payoff matrix for this game where each player’s payoff is equal to the value of market it captures less the cost of advertisement. (please explain how you calculate the payoff matrix)Let’s use the Fisher effect to use two known values to learn about the unknown third one. Consider the table, with some values given and some missing. ?i ??Eπ ?EquilibriumrEquilibrium 5% 2% 3% 5% 1% ___ 5% ___ 8% ___ 10% 2% 6% ___ 2% 0% -2% ___ Compute the missing values in the table. ?=5%,??=1%,?Equilibrium=i=5%,Eπ=1%,rEquilibrium= % ?=5%,?Equilibrium=8%,??=i=5%,rEquilibrium=8%,Eπ= % ??=10%,?Equilibrium=2%,?=Eπ=10%,rEquilibrium=2%,i= % ?=6%,?Equilibrium=2%,??=i=6%,rEquilibrium=2%,Eπ= % ?=0%,??=−2%,?Equilibrium=An investment club has set a goal of earning 15% on the money it invests in stocks. The members are considering purchasing three possible stocks, with their cost per share (in dollars) and their projected growth per share (in dollars) summarized in the following table. (Let x = computer shares, y = utility shares, and z = retail shares.) Stocks Computer (x) Utility (y) Retail (z) Cost/share 30 44 26 Growth/share 6.00 6.00 2.40 (a) If they have $392,000 to invest, how many shares of each stock should they buy to meet their goal? (If there are infinitely many solutions, express your answers in terms of z as in Example 3.) (x, y, z) = ? (b) If they buy 700 shares of retail stock, how many shares of the other stocks should they buy? computer ? shares utility ? shares What if they buy 1400 shares of retail stock? computer ? shares utility ? shares (c) What is the minimum number of shares of computer stock they should buy?? sharesWhat is the…
- The soft drink industry is dominated by TCCC and PSC. The market is worth $6 billion. Each firm can decide whether to advertise, but advertising costs $1 billion to any firm undertaking it. Moreover, advertising will create only negligible new demand as the market is already saturated. So, for the purpose of this question, assume that the market remains at $6 billion regardless of advertising. If one firm advertises and the other does not, then the former captures the whole market. If both firms advertise, then TCCC captures 60% of the market and PSC captures 40% of the market, but the advertising must be paid for. If neither firm advertises, then the market is again split 60:40, with 60% going to TCCC and 40% to PSC. 1. Draw the payoff matrix for this game where each player’s payoff is equal to the value of market it captures less the cost of advertisement. 2. Do any of the firms have dominant strategies? If so, what are they? Is there a dominant strategy equilibrium? If so,…A firm plans to expand its product line and faces a dilemma whether to build a small or largefacility to produce new products. If it builds a small facility and demand is low, the NPV afterdeducting for building costs will be four hundred thousand pesos. If demand is high, the firm caneither maintain the small facility or expand it. Expansion would have an NPV of four hundredfifty pesos while maintaining the small facility would have an NPV of fifty thousand pesos. If alarge facility is built and demand is high, the estimated NPV would be eight hundred thousandpesos. If demand turns out to be low, the NPV would be a loss of ten thousand. The probabilitythat the demand is high is estimated to be sixty percent.a. Analyze using a decision tree.b. Compute for EVPI.c. Determine the range over which each alternative would be best in terms of the valuewhen demand is low.DERIVATIVES Differentiate f(x)=(4x4+3x)(2x4+2x) Let u(x)=(4x4+3x) and v(x)=(2x4+2x)
- (Symmetric mixed strategy Nash equilibrium) A profile α∗ of mixed strategies in a strategic game with vNM preferences in which each player has the same set of actions is a symmetric mixed strategy Nash equilibrium if it is a mixed strategy Nash equilibrium and α∗ i is the same for every player i. Solve this problem: At a large round table sit n ≥ 2 players, each holding 3 cards: one white, one black, and one red. Each player must secretly choose one of their cards and then, when the bell rings, simultaneously reveal it publicly with all the others. If all players choose the white card, each of them receives 6 points. If player i chooses the white card, and at least one of the other players chooses a card of a different color, player i receives 1 point. If player i chooses the black card, they receive 3 points, regardless of the decisions of the other players. If player i chooses the red card, they receive 0 points, regardless of the decisions of the other players. Find all symmetric…Cameron and Luke are playing a game called ”Race to 10”. Cameron goes first, and the players take turns choosing either 1 or 2. In each turn, they add the new number to a running total. The player who brings the total to exactly 10 wins the game. a) If both Cameron and Luke play optimally, who will win the game? Does the game have a first-mover advantage or a second-mover advantage? b) Suppose the game is modified to ”Race to 11” (i.e, the player who reaches 11 first wins). Who will win the game if both players play their optimal strategies? What if the game is ”Race to 12”? Does the result change? c) Consider the general version of the game called ”Race to n,” where n is a positive integer greater than 0. What are the conditions on n such that the game has a first mover advantage? What are the conditions on n such that the game has a second mover advantage?You and a coworker are assigned a team project on which your likelihood or a promotion will be decidedon. It is now the night before the project is due and neither has yet to start it. You both want toreceive a promotion next year, but you both also want to go to your company’s holiday party that night.Each of you wants to maximize his or her own happiness (likelihood of a promotion and mingling withyour colleagues “on the company’s dime”). If you both work, you deliver an outstanding presentation.If you both go to the party, your presentation is mediocre. If one parties and the other works, yourpresentation is above average. Partying increases happiness by 25 units. Working on the project addszero units to happiness. Happiness is also affected by your chance of a promotion, which is depends on howgood your project is. An outstanding presentation gives 40 units of happiness to each of you; an aboveaverage presentation gives 30 units of happiness; a mediocre presentation gives 10 units…