The Hull Petroleum Company and Inverted V are retail gasoline franchises that compete in a local market to sell gasoline to consumers. Hull and Inverted V are located across the street from each other and can observe the prices posted on each other's marquees. Demand for gasoline in this market is Q= 100 -4P, and both franchises obtain gasoline from their supplier at $2.75 per gallon. On the day that both franchises opened for business, each owner was observed changing the price of gasoline advertised on its marquee more than 10 times; the owner of Hull lowered its price to slightly undercut Inverted V's price, and the owner of Inverted V lowered its advertised price to beat Hull's price. Since then, prices appear to have stabilized. Under current conditions, how many gallons of gasoline are sold in the market, and at what price? Instructions: Enter your responses rounded to the nearest two decimal places. Gallons sold: Price: $| How would prices differ if Hull had service attendants available to fill consumers' tanks but Inverted V was only a self-service station? O Price will go up O Price will not change O Price will go down
The Hull Petroleum Company and Inverted V are retail gasoline franchises that compete in a local market to sell gasoline to consumers. Hull and Inverted V are located across the street from each other and can observe the prices posted on each other's marquees. Demand for gasoline in this market is Q= 100 -4P, and both franchises obtain gasoline from their supplier at $2.75 per gallon. On the day that both franchises opened for business, each owner was observed changing the price of gasoline advertised on its marquee more than 10 times; the owner of Hull lowered its price to slightly undercut Inverted V's price, and the owner of Inverted V lowered its advertised price to beat Hull's price. Since then, prices appear to have stabilized. Under current conditions, how many gallons of gasoline are sold in the market, and at what price? Instructions: Enter your responses rounded to the nearest two decimal places. Gallons sold: Price: $| How would prices differ if Hull had service attendants available to fill consumers' tanks but Inverted V was only a self-service station? O Price will go up O Price will not change O Price will go down
Chapter7: Uncertainty
Section: Chapter Questions
Problem 7.15P
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Transcribed Image Text:The Hull Petroleum Company and Inverted V are retail gasoline franchises that compete in a local market to sell gasoline to
consumers. Hull and Inverted V are located across the street from each other and can observe the prices posted on each other's
marquees. Demand for gasoline in this market is Q= 100 -4P, and both franchises obtain gasoline from their supplier at $2.75 per
gallon. On the day that both franchises opened for business, each owner was observed changing the price of gasoline advertised on
its marquee more than 10 times; the owner of Hull lowered its price to slightly undercut Inverted V's price, and the owner of Inverted V
lowered its advertised price to beat Hull's price. Since then, prices appear to have stabilized. Under current conditions, how many
gallons of gasoline are sold in the market, and at what price?
Instructions: Enter your responses rounded to the nearest two decimal places.
Gallons sold:|
Price: $
How would prices differ if Hull had service attendants available to fill consumers' tanks but Inverted V was only a self-service station?
O Price will go up
O Price will not change
O Price will go down
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