Suppose inverse demand is given by the following: P = 40 - 0.5Q There are two firms each with the same marginal cost. Marginal Cost is 10. Under Cournot competition, what is the output for firm one? 10 20 25 30
Q: Please look up the definition of Hyperinflation and cite examples of 3 countries that have…
A: A scenario known as hyperinflation occurs when an economy's inflation rate is excessively high,…
Q: What is the equilibrium payoff of player 1? PLAYER 1 Up Down PLAYER 2 Left 35, 35 18, 28 Right 58,41…
A: Dominant strategy is the strategy that yields higher payoff and the strategy does not change with…
Q: As you have learned consumer expectationsLinks to an external site. are a major driver of the short…
A: ***Since the student has not provided the external links, hence, the expert is required to solve the…
Q: Suppose that Ava withdraws $200 from her savings account at Second Bank. The reserve requirement…
A: The funds kept in bank accounts are referred to as deposits. Reserves are the sum of deposits that…
Q: The elasticity for demand of widgets is equal to -2. The deadweight loss caused by a tax on widgets…
A: When the equilibrium for a good or service is not reached or is not possible, it results in a loss…
Q: Firm A profit max Firm B cannot sell any cannot sell any cannot sell any cannot sell any profit max…
A: Maximum profit is only possible if MR = MC. The firm has the ability to enhance production in the…
Q: 8. A fundamental criticism of the traditional theory of the firm is that the decision makers in the…
A: Since you have posted multiple questions, we will provide the solution only to the first question as…
Q: A price index is Multiple Choice the cost of a market basket of goods and services in a base period…
A: Price is the amount of money necessary to purchase a specific good. It entails the idea that…
Q: 1. What is the marginal rate of technical substitution at each cost minimizing equilibrium point?…
A: The marginal rate of technical substitution (MRTS) depicts the rate at which a producer can…
Q: Which answer below best describes the difference between the short-run and long-run aggregate supply…
A: Aggregate Supply in simple terms refer to the total output produced and supplied by all the firms in…
Q: An entrepreneur needs thousand of dollars to launch the global expansion of his software business. I…
A: Present value is a concept used to determine the value today of a future sum of money, based on the…
Q: 3. Suppose that air pollution is a problem. a. Describe a "cap and trade" policy as a possible…
A: Pollution means the material that positions the environment. This harmful material is known as a…
Q: QUESTION 3 Because it fumes at room temperatures, hydrochloric acid creates a very corrosive work…
A: Business operation refers to the process of manufacturing and day-to-day activities. Business…
Q: Susan has a choice between two perpetuities payable at the beginning of every month. The first pays…
A: Given:Growth Rate (g) = 1% per monthInterest (i) = 20%/12 = 1.667% First annuity: $100 today and…
Q: Suppose money demand depends on disposable income, so that the equation for the money market becomes…
A: Money Market Equilibrium : LM relation => M/P = L (r , Y- T ) Goods market equilibrium : IS…
Q: Barney decides to quit his job as a corporate accountant, which pays $11,000 a month, and goes into…
A: Implicit cost is the foregone income that could have been earned if resources were invested…
Q: Question 3 Judge Mark Griffiths finds that Moodle is a relentless and predatory monopolist. Judge…
A: Monopoly: monopoly refers to a situation where a single firm or entity controls the entire market…
Q: For the demand equation, express the total revenue R as a function of the price p per item.…
A: We have given the following demand equation. q = -5p + 1000 where q is the quantity demanded. p is…
Q: You are an owner of a local Toyota dealership. Your dealership earned record profits of 13 million.…
A: Given: N=3EM=-1.5MC=$12000 Here N is the total number of dealers in the market EM is the market…
Q: No. 6 Consider the following equations for this particular economy. C = 100+ 0.75Yd I = 150 G = 250…
A: The aggregate expenditure model is a macroeconomic metric used to analyze and evaluate a country's…
Q: Specify the strategies for P1 and P2, respectively. Eliminate all strictly dominated strategies, and…
A: E F G H A 10,30 0,50 5,5 40,20 B 40,10 10,10 8,20 30,5 C 15,5 10,30 5,20 25,20 D 20,3 20,8…
Q: Compare and contrast the monopoly and oligopoly market .
A: A market is a system where buyers and sellers can trade commodities, services, or other valuables.…
Q: Ryan deposited P2,000, P2,500 and P3,000 at the end of the 2nd year, 3rd year and 4th year,…
A: Present value is the value of investment in today's dollar. Future value is the value of investment…
Q: Andover Bank and Lowell Bank each sell one-year certificates of deposit (CDs). The interest rates on…
A: Interest rate in economics refers to the cost of borrowing or the return on lending. It represents…
Q: First Call Inc. is a cellular phone company. It plans to build an assembly plant that costs $10…
A: The market for loanable funds is the interaction between borrowers and lenders. The demand for…
Q: Suppose that Far North Canadian Lumber, Ltd., sells lumber in Canada at a price of $1,000 per 1,000…
A: Dumping means exporting a product to a foreign country at a price that is lower than the price…
Q: You have already saved $55. You earn $9 per hour at your job. You are saving for a bicycle that…
A: Given: Cost of bicycle = $199 Total saved money = $55 Remaining money required to buy the bicycle…
Q: Determine the profit-maximizing quantity, the profit-maximizing price and the profit of the firm…
A: Total revenue is the product of price and quantity. Total profit is the difference between the…
Q: 7. The long-run supply curve in different cost industries The following graph shows the market for…
A: The equilibrium price in the market is determined at the point of intersection between the demand…
Q: What is the present equivalent of a uniform series of quarterly payments of $4,500 each for 8 years…
A: This cash flow contains two uniform series, one is $4500 paid quarterly for the first 8 years and…
Q: Why is the demand curve facing an individual firm in a perfectly competitive market horizontal? Does…
A: A market with perfect knowledge, many buyers, and a large number of tiny enterprises offering a…
Q: A mechanical engineer designs and sells equipment that automates manual labor processes. He is…
A: To conduct a replacement analysis, we need to compare the costs and benefits of keeping the existing…
Q: Use the following table to answer the question below. Quantity Demanded Price Quantity Supplied…
A: Demand Schedule: Demand schedule for a good is a combination of different price and optimal quantity…
Q: The elasticity of demand for a firm's product is -5 and its advertising elasticity of demand is…
A: The own-price elasticity of demand for a firm is: EQ,P = -5 Advertising elasticity of demand is:…
Q: Suppose that the parents of a young child decide to make annual deposits into a savings account,…
A: Let, Annual deposit be A Deposit begins from the 5th Birthday to the 15th birthday. Withdrawal…
Q: Find gradient factor (A/G, 1.015%, 34)
A: Present value is the value of investment in today's dollar. Future value is the value of investment…
Q: A company produces very unusual CD's for which the variable cost is $ 9 per CD and the fixed costs…
A: Total cost is a sum fixed cost and variable cost. Total revenue is the product of price and output
Q: Maintenance cost for small bridge with an expected 50 year life are estimated to be $15,000 each…
A: Given: Estimated life = 50 years Interest rate = 10% compounded monthly Annual cost for initial 7…
Q: Diddy spends $1,500 on a new laptop to use in his business in San Francisco. The laptop was built in…
A: Trade between countries is known as import and export between countries. Import means buying the…
Q: Now assume that both firms are in the market and they choose quantities to supply. Assume also that,…
A: Markup refers to the amount added by a firm to the cost of a product to arrive at the selling price.…
Q: QUESTION 9 When the lead time doubles, the economic production quantity will increase. True False…
A: Production economics is the application of the standards of microeconomics in production. based on…
Q: 17. Suppose a tax of $6 is imposed on sellers. (a) Calculate consumer surplus, producer surplus,…
A: Demand and supply forces determine the price and output level of the market. Equilibrium through…
Q: Compare the alternative shown on the basis of their capitalized costs using an interest rate of 10%…
A: Capitalized cost refers to the cost that is assed to the cost for a fixed asset in a balance sheet…
Q: During the Covid pandemic the Federal Government sent several checks to individuals and families.…
A: A macroeconomic framework for evaluating an economy's overall performance is the aggregate supply…
Q: Could you explain the quantity and quality of children (Gary Becker) by using the graph
A: Gary Becker was an American economist who made significant contributions to the field of human…
Q: Jean deposited P2,000, P2,500 and P3,000 at the end of the 2nd year, 3rd year and 4th year,…
A: We have given i=0.09 We have to find an equivalent uniform annual deposit for the uniform gradient…
Q: 4 Bubblegum & Computers If the cross-price elasticity of computers with respect to bubblegum equals…
A: According to guidelines, only first question is supposed to be done. Let's first understand what…
Q: Give the production function: Q(K,L) = L + K2 a. Find the total cost function (TC) if w = $2 (wage…
A: Monopoly and perfect competition are two extreme market structures that represent different types of…
Q: Just north of the town of Muskrat, Ontario is the town of Brass Monkey, population 4,500. Brass…
A: Pareto efficiency, or Pareto optimality, is an economic implies where resources cannot be apportion…
Q: Assuming the tax cut of $245 billion, what is the total amount of taxes paid by the families in the…
A: A tax cut is a reduction in the amount of money that people or corporations must pay to the…
Answer the given question with a proper explanation and step-by-step solution.
Suppose inverse
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
- Suppose three firms compete in a homogeneous-product Cournot industry. The market elasticity of demand for the product is −2, and each firm’s marginal cost of production is $50. What is the profit-maximizing equilibrium price?Suppose the demand for pizza in a small isolated town is p = 10 - Q. There are only two firms, A and B, and each has a cost function TC = 2 + q. Determine the Cournot equilibrium Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.A market is served by two firms in Cournot competition, each with a constant marginal cost of $100. The market inverse demand curve is P = 2,000 – 50 Q, where Q is the total market output produced by the two firms, q 1 + q 2. What is Firm 1's reaction function? A. q1 = 400 – 100q2 B. q1 = 19 – 0.5q2 C. q1 = 400 – 0.2P D. q1 = 210 – q2
- Consider two identical firms (firm 1 and firm 2) that face a linear market demand curve. Each firmhas a marginal cost of zero and the two firms together face demand: P = 50 - 0.5Q, where Q = Q1 +Q2. Find the Cournot equilibrium quantity and market price for each firm.Suppose there are just two firms, 1 and 2, in the oil market and the inverse demand for oil is given by P = 60 – Q. The marginal cost for each firm is €30. What price should Firm 2 charge at the Cournot equilibriumplease solve the question completely. Suppose an industry consists of two firms that compete in prices. Each firm produces one product. The demand for each product is as follows: q1 = 25 - 5p1 + 2p2 q2 = 25 - 5p2 + 2p1 The cost functions are C(qi) = 2 + qi for i = 1; 2. (a) Are the products produced by these firms homogenous or differentiated? (b) Find the best response function for each rm. (c) How does the price firm 1 sets change with its belief about the price of its competitor\'s product? (d) What are the Nash equilibrium prices? (e) What is the percentage markup of price over marginal cost here (this is called the Lerner index)? Do the firms have market power? Why does the Bertrand paradox of zero variable duopoly profits apply here? (f) Suppose the firms merged. What is the new price of products 1 and 2? (g) Explain intuitively why the price is higher under monopoly than under Bertrand duopoly? (h) Are total monopoly profits higher or lower than the sum of Bertrand duopoly…
- Suppose that Raleigh and Dawes are the only sellers of bicycles in the UK. The inverse market demand function for bicycles is ?(?)=200−2?. Both firms have the same total cost function: ??(?)=12? and the same marginal cost: ??(?)=12.Suppose this market is a Stackelberg oligopoly and Raleigh is the first mover.a) Write down a formula for the reaction function of Dawes.b) Calculate the equilibrium quantity that each firm produces and the equilibrium price in the market.c) At the Stackelberg equilibrium, how much profit does each firm make?Suppose now that the two firms decide to act like a single monopolist.a) What will the total quantity of bicycles sold in the market be and what will the equilibrium price be? Represent the profit maximisation problem on a graph and indicate the price and quantity at the equilibrium.b) Calculate the total profit made by the two firms when they act like a monopoly. Compare it with the total profit they were making in the Stackelberg oligopoly.c) For the…Consider an industry with only two firms: firm A and firm B. The industry’s inverse demand is P(Q) = 400 − 1/10Q where P is the market price and Q is the total industry output. Each firm has a marginal cost of $10. There are no fixed costs and no barriers to exit the market. Suppose that the two firms engage in Cournot competition. Find the equilibrium price in the industry, the equilibrium outputs, as well as the profits for each firm.Two firms compete under Cournot competition with constant marginal costs c_1 = 9 and c_2 = 3. The market demand is P=24-Q. a) Compute the market share of each firm, the market price, and the total quantity produced in the market. b) Compute the HHI index. c) Compute the Lerner index.
- Use this information for this and the next question: The market inverse demand curve is given by P(Q) = 100 - 0.02Q, where Q is the total output in the industry. The dominant firm in this industry has costs given by TC(q) = 40q. In addition, there are 25 small firms. These firms are known as the 'competitive fringe' of the market. These small firms all take as given the price established by the dominant firm in the industry. All small firms have the same cost function: TC = 60q + q2. If the dominant firm's quantity is 1000 units, the market price will be a) 80 B) 70 C) 75 D) 85 E) None of the aboveReference the following information about the market demand function for questions 1 to 15. These questions are on different types of market structures – monopoly, perfect competition, Cournot oligopoly market, and the Stackelberg oligopoly market. The market demand function is given the following equation: P = 2000 – Q where Q is the industry’s output level. Suppose initially this market is served by a single firm. Let the total cost function of this firm be given the function C(Q) = 200Q. The firm’s marginal cost of production (MC) is equal to the firm’s average cost (AC): MC = AC = 200. What is the difference in the industry output levels produced by the perfectly competitive industry (Qc) and the monopoly (Qm) industry? Group of answer choices Qc - Qm = 900 units Qc - Qm = 1800 units Qc - Qm = - 900 units Qc - Qm = 600 unitsConsider an industry with only two firms: firm A and firm B. The industry’s inverse demand is P(Q) = 400 − 1/10Q where P is the market price and Q is the total industry output. Each firm has a marginal cost of $10. There are no fixed costs and no barriers to exit the market. Suppose the two firms engage in Stackelberg competition, with firm A moving first, and firm B moving second. Find the equilibrium price in the industry, the equilibrium outputs, as well as the profits for each firm