Suppose that two firms with zero marginal costs are facing the inverse demand P=240-Q. Show that it is more advantageous to be the leader and announce your output decision first.
Q: Maria's sandwich shop finds that when it caters 45 meals a week, its total cost is $8,500. If Maria…
A: Total Cost = 8,500 Total Variable = 6,500 N Number of meals = 45 per week
Q: 10 Output TC TFC TVC AFC AVC ATC SMC 0 0 XX XX XX 20 8. 30 215 40 Fill in the blanks in the table…
A: The cost incurred by the firm for producing the final goods and services is known as the cost of…
Q: 8. Fill in the blanks in the table below: Output TC TFC TVC AFC AVC ATC SMC 0 0 XX 10 20 30 215 40…
A: Firm hire various factors of production like, land, labor, capital and enterpreneur from the…
Q: Match the following terms to their best definitions When a subject stops taking the assigned…
A: In a lab experiment or field experiment there are participants who are randomly allocated to two…
Q: Jo buys muffins and cupcakes at a bakery. Jo’s weekly budget for baked goods is $70. The price of…
A: Budget constraints shows the relationship between the goods , price of goods and income of consumer.…
Q: Suppose that market demand for a good is Q=480 - 2p. The marginal cost is MC = 2Q. Calculate the…
A: The monopoly is the market where only single firm exists in the market. While in the perfectly…
Q: Which of the following statements are true when comparing insurance companies to banks? O a. Banks…
A: Banks and insurance companies are both financial institutions. However, there are differences…
Q: Research the difference between pure competition and monopoly pricing. Compare and contrast the…
A:
Q: Clean L/C doesn't require financial documents such as bills. if the following explanation (or…
A: A letter of credit refers to the document that can guarantee the payment of the buyers to the…
Q: Money deposited in a certain account for which the interest is compounded continuously. If the…
A: Compound interest means the interest is generating in the previous interest also. Formula to find…
Q: How do you determine how much the interest rates rise ? Why is it 2% ??
A: In this case, multiplier is getting as the function of MPC i.e. Marginal Propensity to consume which…
Q: Research and Development money spent by pharmaceutical companies creating new drugs is a sunk cost…
A: A sunk cost refers to those costs that company already been incurred and cannot be recovered. Sunk…
Q: i need it in words not handwrittenn just ReWritwe it
A: Given: Face value (F) = 1,00Maturity (T) = 30Coupon rate (C) = 0.08 Value to maturity (y) = 0.10
Q: . If P 5,000 shall accumulate for 10 years at 8% compounded quarterly, then what is the compound…
A: Given: Present value = 5000 Number of years = 10 The interest rate is:
Q: 2) What types of efficiency does the economic outcome under monopolistic competition lead to?
A: Productive efficiency means that firm is minimising its wastage of resources that means efficiently…
Q: Consider the following economy: Consumption: C=0.6Y+10 Exports: X=0.15Y*+ 3e, and imports Q-0.1Y-2e,…
A: GDP for the economy needs to be calculated. GDP refers to the sum total of all goods and services…
Q: 14.3 (0) Quasimodo consumes earplugs and other things. His utility function for earplugs x and money…
A: Answer a) The utility's functions should in the questions is a quasilinear utility's functions. b)…
Q: Question 2 Two laptop producers, Micron and Mega, are considering producing a new model of laptop…
A: This is a sequential game where a player plays first. And the another player observe the action of…
Q: A regressive tax A. imposes a greater burden on those with higher incomes than on those with lower…
A: A regressive tax is the tax based on income. The regressive tax is inversely proportional to…
Q: Real gross domestic product (GDP) in base-year dollars equals: A.the current price index divided by…
A: Gross Domestic Product is the sum total of the market value of final goods and services produced in…
Q: 1. Consider a consumer with Cobb-Douglas utility function U(x,y) = x¹/³.y2/3 Assume that the…
A: Optimal consumption bundle: The optimal consumption bundle is such that at that bundle the…
Q: You are thinking about becoming a Paradise Coffee franchisee. Franchisees are offered a business…
A: Implicit cost are also known as opportunity costs which is the forgone income. The explicit cost is…
Q: Suppose now that Clomper's is able to perfectly price discriminate-that is, it knows each consumer's…
A: The profit-maximizing quantity is fixed by a monopoly firm without price discrimination at the…
Q: Labour or work relationships have existed since the first individual approached another to perform a…
A: Industrial revolution: According to modern times, the industrial revolution explains the entire…
Q: What would the value C(75) represent in this context? B. Is function Cincreasing or decreasing? What…
A: C is the cost of the rental car in dollars and it a function of the miles driven in a day or the…
Q: a. Use the table below to help you answer the following questions. How many bushels How much revenue…
A: Total revenue refers to the sum of all the revenue earned from all the units sold. Marginal revenue…
Q: A firm has the production function Q = K^0.8L^0.2. The wage is W and the rental rate on capital…
A: Given Production function: Q=K0.8L0.2 ......(1) Wage rate = W rental rate = R The long-run…
Q: Table 11-1 Consider the town of Springfield with only three residents, Sophia, Amber, and Cedric.…
A:
Q: The following graph illustrates the market for almonds. It plots the monthly supply of almonds and…
A: In economic analysis, the word equilibrium is frequently employed. Equilibrium is a scenario in…
Q: A debt of 45,000 with interest at 12% compounded monthly is to be repaid with payments of 20,000 and…
A: Given, Debt = 45,000 Interest Rate = 12% first Payment after 3 months = 20,000 Second payment after…
Q: Suppose that in 1980, the U.S. inflation rate was 14 percent and the unemployment rate reached 7.6…
A: The Taylor rule refers to the equation that links the benchmark interest rates of the Fed and levels…
Q: 20. What is the present worth of two P100.00 payments at the end of the third year and fourth year?…
A: Present worth, also known as present discounted value, is the estimated value of an expected income…
Q: Felix, Larry, and Raphael are trappers who live next to a recreational hunting area that is open to…
A: Common resources are defined as the scarce resources like water, which is providing users with…
Q: A recapping plant is planning to acquire a new Diesel generating set to replace its resent unit…
A: The annual worth method or AW method implies that all the incomes along with disbursements, regular…
Q: (a) Find ACME Corporation's reaction function. (b) If Tesla accommodates entry, find Tesla's…
A: To find the best response of the given firm we have to find the output of the firm in profit…
Q: The table below presents the industry output for three different industries. Firm Industry 1…
A: The concentration ratio is a measure which shows the size of individual firms in relation to the…
Q: The table below shows the short run production function for Corey's Card Store. Number of workers 1…
A: Marginal product of labor: it refers to the change in total production if the firm hires an…
Q: Jimmy has a credit rating of 340 and Sarah has a credit rating of 550. Sarah receives an offer of…
A: Interest rate are the interest which is generated on investment and are to be paid by the borrower…
Q: 2. Consider a finitely repeated game with a unique Nash equilibrium in each stage game. What is the…
A: Repeated games are when the players play a normal form game. Learn from their actions and then play…
Q: Using a domestic-market demand- and supply-curve graph, show the impact of tariff on a small…
A: DISCLAIMER “Since you have asked multiple questions, we will solve the first three questions for…
Q: If the price and quantity for a normal good, Good A, is $7 and 5 units at the original equilibrium,…
A: An increase in income, all other things unchanged, will cause the equilibrium demand to rise; led to…
Q: Given the production function y = x₁¹/2+x₂¹/2, what is the formula for the expansion path? x₂ = (^)…
A: The production function shows the relationship between the output and inputs. The expansion path is…
Q: _____ shows roughly how long it will take a nation to double its output at various growth rates.…
A: GDP deflator shows the inflation. GDP deflator = (Nominal GDP ÷ Real GDP) × 100 Rule of 70 shows…
Q: Assume the economy has entered a recession. Identify two fiscal and two monetary policy actions that…
A: Recessions are defined as extended periods of weak or negative real GDP (output) growth that are…
Q: Question 1. Mr. Jack is in the process of expanding his manufacturing business. He decided to open…
A: Total Cost is the sum of the total fixed cost (this cost doesn't changes as the output changes) and…
Q: Which of the below is one of the reasons that the Aggregate Demand curve is downward sloping? The…
A: The total demand curve has been prepared under this perception that the government holds the supply…
Q: Consumer choice Jo buys muffins and cupcakes at a bakery. Jo’s weekly budget for baked goods is $70.…
A: The combination of goods that a consumer can buy from his given income or wealth is known as a…
Q: 3.A person deposits $5000 into an account and the reserve requirement is 12.5%. A.Set up a…
A: Here, given information is: New deposits: $5000 Reserve requirements: 12.5% When new money is…
Q: How does a Classical Economist account for savings? A. Investment B. Dissavings C. Consumptin D.…
A: Investment is the sum what is spend on commodities that are not consumed but are durable . For…
Q: Consider a consumer with the following Cobb-Douglas utility function U(x,y) = x¹/³.y2/3 Assume that…
A: Given Utility function: U(x,y)=x1/3y2/3 ......(1) The price of good y is 1 and the price of…
2. Suppose that two firms with zero marginal costs are facing the inverse
Step by step
Solved in 3 steps with 2 images
- 3 In a Cournot market with two firms, the inverse market demand curve is P=50-2Q, where Q=q1+q2(Firm 1’s output is ; Firm 2’s output is ). Both firms have a constant marginal cost of 14. If Firm 2 produces 12 units of output, how much should Firm 1 produce? Group of answer choices 3 6 0 12Answer the given question with a proper explanation and step-by-step solution. 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 30A10 Consider an industry with 2 firms, each firm with marginal costs equal to 0. Market demand curve is given by Q=60- P. With 2 firms, we can write Q=Q1+ Q2 . Suppose that each firm behaves as a “Cournot” competitor, that is, choose the optimal quantity maximizing the profits in a strategic way.(a) What would be the values of Q1, and Q2 in equilibrium? (b) Suppose firm 1 can “commit” its level of output in advance. In other words, if firm 1 announces to produce Q1, firm 2 needs to decide how much to produce assuming that firm 1 would indeed produce Q1. What’s the level of Q1 firm 1 would choose to maximize its profit?
- . (Requires calculus). In the model of a dominant firm, assume that the fringe supply curve is given by Q = -1 + 0.2P, where P is market price and Q is output. Demand is given by Q = 11 – P.What will price and output be if there is no dominant firm? Now assume that there is a dominant firm, whose marginal cost is constant at $6. Derive the residual demand curve that it faces and calculate its profit-maximizing output and price. highest bidder, but both the winning and losing bidders must pay her their bids. So if Jones bids $1 they pay a total of $3, but Jones gets the money, leaving him with a net gain of $98 and Smith with -$1. If both bid the same amount, the $100 is split evenly between them. Assume that each of them has only two $1 bills on hand, leaving three possible bids: $0, $1 or $2. Write out the payoff matrix for this game, and then find its Nash equilibrium.Please no written by hand 1. Suppose the automobile manufacturing industry has two firms, General Motors and Ford. Assume that the market demand function is Q = 1,000 − p, and each firm’s marginal cost and average cost are $40. a. What is the marginal revenue for General Motors? Assume, ??? represent residual demand for General Motors and ?? represents residual demand for Ford. b. What is the best response function for General Motors and Ford? c. What is the Nash-Cournot equilibrium in this market? d. Graph the best response curves for both General Motors and Ford, placing the quantity produced by General Motors (???) in the x-axis. Label intercepts and Nash-Cournot equilibrium.In a market there are five firms, all have a total cost curve equal to CT = 2q. The market demand is Q = 500 - 5P. How much profit would each firm get if they collude and share the market equitably? What is the profit to each firm if they agree to collude, but one firm misleads the others charging a slightly lower price? What is the profit if all firms do not collude and compete via price?
- 3) There are three identical firms in the market research industry. The demand is 1 – Q, where Q = q1 + q2 + q3. The marginal cost is zero. c. Show the result on profits if all three firms were to merge1. Suppose that the market demand curve for bean sprouts is given by P = 1,680 - 2Q, where P is the price and Q is total industry output. Suppose that the industry has two firms, a Stackelberg leader and a follower. Each firm has a constant marginal cost of $80 per unit of output. In equilibrium, total output by the two firms will be?Type out the correct answer ASAP with proper explanation of it within 40 50 minutes.will give you thumbs up only for the correct answer. Thank you Inverse market demand is: P = 1,000 - (Q1+ Q2). Costs for each firm are identical and given by: Ci(Qi) = 4Qi The profit earned by the leader in a Stackelberg oligopoly equals $ What is Q1? What is Q2? What is Price
- 1.In differentiated oligopoly,the elasticity of individual market demand is smaller than in the case of pure oligopoly.Explain this statement in not more three sentences 2.As a prospective production manager of an agribusiness firm whose average variable cost of production is greater than the price per unit of its product in a competitive market indicate ,in not more than four sentences, how would you advice management concerning the operations of the firm 3.Assuming you are the production Economist in a farm firm whose elasticity of production is negative indicate,in not more than 3 sentences, how would you advice management concerning the operations of the firmIn the accompanying figure, if output increases from Q1 to Q2, the firm:a. Decreases its marginal revenueb. Increases its marginal revenuec. It decreases its profitsd. It increases its profits.Please, for each of these alternatives, argue whether they are true, false or uncertain.Q4. Consider two firms competing in a Cournot fashion. Each firm has MC=10 and the market demand is given by P=100-Q, where Q is the total market output. What is firm 1's Response function? a. q1=45-.5q2 b. q1=30 c. q2=45-.5q1 d. firm 1 will set p=MC