e. Generalize your result using parameters a and c: Demand and cost are: P = a - Q1 - Q2 TC1 = cQ1 TC2 = cQ2 Qi*(Q?) = Q2*(Qi) = . Q1* = Q²* P1* = P2* = TRỊ = TC1 = П TR = TC = II II
Q: Explain the national economic system under which the USA operates
A: The United States has a mixed economy. It works as indicated by a financial framework that…
Q: In long-run equilibrium, the marginal social cost exceeds the marginal private cost, but the…
A: Oligopoly is a market with few large firms selling homogeneous or differentiated goods
Q: 2. Consider a market that consists of 10 consumers, i = 1,..., 10, each with the following quasi-…
A: Number of consumers = 10 Individual Utility function : ui = m + 48 (xi)1/3 Value of individual…
Q: 45. Use the graph to answer the question that follows. Which of the following can cause the…
A: Answer is given below
Q: Determine which option, if any, should be chosen based on net present worth using a 8% interest…
A: Project A First cost=$5000 Uniform Annual Benefit = $1100 Useful life=5 Year Project B=10200 Uniform…
Q: Weber Drilling Company is considering investing $20M in oil and gas drilling equipment. It is…
A: The present value of cash flows at the needed rate of return on your project relative to your…
Q: Draw a budget line with good X on the x-axis and Good Y on the Y axis. Graphically illustrate the…
A: Price effect is basically a term that is used to describe the change in the demand preference of a…
Q: In the following matrix for the profits of two dry cleaners with the decision whether or not to…
A: "Dominant strategy" is a term in the game hypothesis that alludes to the optimal choice for a player…
Q: Possible solution in a post normal perspective about regaining the economy of a third world country.
A: Third world economy Third world economy stands for the countries which are less developed. These…
Q: explain why the positive externality associated with the production of a pure public good implies…
A: Externalities are side effects which are borne by the third parties. Externalities could be…
Q: Question 9 A firm has a cost function cL, K) = wL + rK with a production function pL,K) = AL“ K® .…
A: Lagrange approach is used to minimise or maximise a function subject to a constraint
Q: 30 25 20 15 10- 1 3 5 6. 8. Labor 10- 4) 2. Marginal Product
A: Marginal product refers to change in total product with respect to change in input. It refers to…
Q: Which of the following is likely to have the largest effect on spending? O A. A change in expected…
A: People spend out of the income they have already earned . and spending influence the aggregate…
Q: Suppose that the government is going to auction off permits equal to one third of total emissions in…
A: Marginal abatement cost is the cost of reducing environmental negatives such as pollution. The…
Q: The price – supply and price – demand equations of a certain product are given by p = S(x) = 15 +…
A: Given:- p=S(x)=15+0.1x+0.003x2 p=D(x)=M-nx Equilibrium price level=P55 To calculate:- Producer…
Q: Consider the following game in strategic form. f h e a 8,2 b| 10,5 c| 1,4 d 6,6 7, 10 4,8 1,9 3,1…
A: For a player, a Dominant strategy gives equals or less than compared to other strategies.
Q: Someone who wants to buy a car can buy either a used car or a new car. According to the supply and…
A: Supply and demand are influenced by the various factors like Supply of goods is influenced by one…
Q: xplain the difference between pure public goods and pure private goods
A: Answer to the question is as follows:
Q: According to the welfare theory covered in the unit, which of the following statements is true? a.…
A: When talking about welfare theory, there are two theorems to understand the contribution of…
Q: Click to see additional instructions Suppose we estimate a regression of the gallons of paint sold…
A: 5 of 8 Estimated regression equation, in insights, an equation developed to show the connection…
Q: I asked for question F to be answered, not A.
A: Total cost is the sum of a firm's total variable and fixed costs in producing a specific level of…
Q: Question 13 If the consumption function is given by C = ? (Y – T) and there is a tax cut of $200,…
A: Since you have posted multiple question, we will solve first question for you. If you want any…
Q: the larger exporters oppose policy might it's be a case macroeconomics
A: Exports are defined as moveable items produced inside one country's borders that are traded with…
Q: Question 5 Cost data of a machine is shown in the following table with an annual rate of 12%.…
A: Hi! Thank you for the question. As per the honor code, We’ll answer the first question since the…
Q: QUESTION 12 If your willingness to pay for a coffee is 35 dirhams, and the price is 20 dirhams. What…
A: "Consumer surplus represents the difference between the consumer's willingness to pay for a good and…
Q: PROBLEM NUMBER 1 A farmer can plant up to 8 acres of land with wheat and barley. He can earn…
A: A company's optimal point is when it is producing a large amount of items at the lowest feasible…
Q: Question 5 Cost data of a machine is shown in the following table with an annual rate of 12%.…
A: Expected Service Life is a producer defined term for how long the item will keep on being…
Q: 2. The Lorenz curve of a particular society is given by L(x) = Ax? + Bx. Suppose that the poorest…
A: A graphical depiction of the distribution of wealth or income across a population is known as a…
Q: The owners of four companies competing for a contract are shown in the table below. If a report is…
A: Individuals ought to move toward data with shifting levels of skepticism based on the wellspring of…
Q: Rere are many unanswered questions regarding the effects of robots on the future of society, but…
A: The economic impact of robotic advances and AI on the future of society — Self-driving vehicles,…
Q: Q3) A) The demand and supply functions of a product is given as P=200 – 0.5Q and P = 100+0.5Q,…
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: The entire market for a good is 1,000 units, and the minimum efficient scale is 5 units. Which of…
A: When talking minimum efficient scale, it is the level of output at which a firm is producing at its…
Q: Estimates for one of two process upgrades are as follows: First Cost = Php 40,000 Annual Cost = Php…
A:
Q: 3. Below is the table representing the cost of production and demand schedule for Roxxy's Wigs.…
A: Answer: Given, (a). A short run is a time period where there are two types of input i.e. fixed and…
Q: How would the creation of an import quota affect the market for a good? Imported supply increases…
A: Import quota puts restrictions on quantity that can be imported.
Q: What happens to the supply curve for labor (shifts to the right/left or stays the same) in the…
A: Since you have posted a question with multiple sub parts, we will solve first three subparts for…
Q: 1. Many small companies use accounts receivable as collateral to borrow money for continuing…
A: The amount of interest that is payable every period, expressed as a percentage of the principal that…
Q: QUESTION 25 The Marginal Cost curve crosses the Average Total Cost curve at its maximum. True False
A: "Marginal cost represents change in total costs when one more unit is produced while average total…
Q: Go Green is a business selling worm farm start-up kit for $12 each. This year, Go Green's fixed cost…
A: ''Since it is a mutipart question, we will solve the first three sub-parts for you. If you want any…
Q: Name and discuss the factors that shift the IS Curve. Give two examples, with the help of a diagram,…
A: The term "IS curve" refers to the graph that illustrates the various permutations of the level of…
Q: Data from The Economist BigMac index from January 2021 shows that the local price of a Big Mac in…
A: The PPPR computed Currency X = Currency Y *(adjusted to value of volatility) We have, Denmark Big…
Q: Consider the following data on the GDP of Z-product: i) What was the growth rate of nominal GDP…
A: GDP is the value of final goods and services produced in the economy within a given period of time
Q: In a market for chemicals, the demand function is P = 200 – Q. The private marginal cost for the…
A: Externalities is the negatives spillover effect of an economic activities of person which have…
Q: The reason why monetary policy is neutral in the long-run is: In the long-run, technological change…
A: Monetary policy refers to change in money supply.
Q: Fruit prices and the amounts consumed for 2010 and 2018 are shown. Use 2010 as the base Price se.24…
A: Price Index is the index that shows the level of prices of goods and services in a year. It is used…
Q: D. - $489 billion.
A:
Q: x= chronological order of the second letter in your first name y = is the last digit of your student…
A: Given information Demand rate function X2+3*P*X+P2=79 P=5
Q: however, option e mentions upward sloping straight line, did you simply mean upward sloping curve or…
A: The preferences of Goluki are determined by U(q1, q2) = q11/3 + q21/3 Where, q1 is the number of…
Q: (35) Consumers who gain the highest marginal benefit from a good supplied by a perfectly…
A: In perfect price discrimination, firm charges the price equals to the willingness to pay of each…
Q: Consider the Scenario given below and attempt the questions that follow: COVID-19 Lockdown Price…
A: Changes in the external environment surrounding the retail industry have shifted conventional wisdom…
Step by step
Solved in 2 steps
- There are only two driveway paving companies in a small town, Asphalt, Inc. and Blacktop Bros. The inverse demand curve for paving services is ?= 2040 ―20? where quantity is measured in pave jobs per month and price is measured in dollars per job. Assume Asphalt, Inc. has a marginal cost of $100 per driveway and Blacktop Bros. has a marginal cost of $150. Answer the following questions: Determine each firm’s reaction curve and graph it. How many paving jobs will each firm produce in Cournot equilibrium? What will the market price of a pave job be? How much profit does each firm earn?In the aeronautical market, Boing and Airbus constitute a duopoly in the production of large airplanes. The American firm has the following cost structure C(qa) = 20 + 39a + qả, and the European firm, C(qe) 150 – P, answer the following questions. = 50 + qe + q?. If the market demand for large airplanes is given by Qp = 9a + qe = a) Interpret the cost structures of both firms b) What would be the equilibrium (quantity, price, and profit) if firms compete by quantity as in Cournot and interpret your answer. c) If they decide to form a cartel, what are the new quantities, prices, and profits? Interpret your answer using the Game Theory insights. d) Calculate now what would happen if Airbus is the leader (Stackelberg model) in terms of quantity, price, and profit and interpret your outcomes.Suppose two identical firms (A and B) engage in Cournot competition. Market demand is characterized by inverse demand P(Q)=500- 20Q. The marginal cost of both firms is 10. A) Determine the profit function for firm A. (5 marks) B) The corresponding marginal revenue curves associated with inverse demand are MRA=500-40qA-20qB for firm A and MRB=500-40qB-20qA for firm B. Determine the best-response functions for firms A and B. (10 marks) C) Calculate the Cournot equilibrium price and quantities, and the profits each firm makes. (10 marks) D) If the firms colluded, would the quantity offered to the market be higher or lower? Would deadweight loss be higher or lower? How do you know? (5 marks)
- Three firms compete in the style of Cournot. All firms have a constant returns to scale technology: There are no fixed cost and each firm's marginal cost is constant. The market demand is given by Q(P) = 9 - P. Firm 1's marginal cost is MC1 = 1, firm 2's marginal cost is MC2 = 2. Let MC3 be the marginal cost of Firm 3. Which of the below is a necessary condition so that q > 0 for all three firms in a Nash equilibrium? a. MC3 < 1 b. MC3 < 4 c. MC3 < 3 d. MC3 > 1 e. MC3 < 2Alpha and Gamma are the only two phone handset manufacturers in the world. Each firm has a cost function given by: C(q) = cq + q?, where q is number of phones produced and c=70. The market demand for phones is represented by the inverse demand equation: P = a - bQ where Q = q1 + q2 is total output, a=250 and b=1. Suppose that each firm maximizes its profits taking its rival's output as given (i.e. the firms behave as Cournot oligopolists). a) What will be the equilibrium quantity selected by each firm? What is the market price? What is the profit level for each firm? Equilibrium quantity for each firm , price , profit b) It occurs to the managers of Alpha and Gamma that they could do a lot better by colluding. If the two firms were to collude, what would be the profit-maximizing choice of output for each firm? What is the industry price? What is the profit for each firm in this case? Equilibrium quantity for each firm , price , profit c) What minimum discount factor is required for…1. if the total cost function for this market is TC = 500 + 10Q2 , calculate the total and marginal costs for each of the quantities in the table. what is the demand function for this market? 2. What are the profit-maximizing quantity, price, and profit for this market? 3. If there are two firms Atlas and Bowden in this market with the same earlier total cost function and they engage in Cournot competition, what is each firm's equilibrium quantity, price, and profit? [NB: round quantities to nearest integer to find equilibrium quantity, price, and profit]
- Only typed answer Two firms both produce leather boots. The inverse demand equation is given by P = 340 - 2Q, where P is the price of boots in USD/pair and Q is quantity of boots in million pair. The cost function is given by: C(Q) = 40Q. If the two firms are Stackelberg oligopolists), the output of the leader is equal to: 1) 60 2) 80 3) 75 4) 900Suppose 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 the following market demand function: Q= 20-2P, where P is the market price. Suppose there are two firms- A,B in the market and they have the same cost function: the per unit cost of producing output is 4. The firms compete by choosing quantities. Find the reaction functions for both the firms if they are maximizing profits. What is the profit maximizing output for each firm and corresponding market price? If there was only one firm in the market how would your answer change?
- Reference 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 unitsSuppose that Raleigh and Dawes are the only sellers of bicycles in the UK. The inverse market demand function for bicycles is P(Y)=200-2Y. Both firms have the same total cost function: TC(Y)=12Y and the same marginal cost: MC(Y)=12. Suppose this market is a Stackelberg oligopoly, and Raleigh is the first mover. Write down a formula for the reaction function of Dawes. Calculate the equilibrium quantity that each firm produces and the equilibrium price in the market. Give typing answer with explanation and conclusionNeed answer for part b only Zeus and Iron are the only two cement producers in Gotham. The cement they produce is essentially identical. In this market, each firm chooses the output level to produce and the price is determined by aggregate output (Cournot competition). The inverse demand for cement is given by P = 225 − Q/2 . Q is measured in tons and P is in euros. The marginal cost for Zeus is constant at 50 euros/ton. The respective cost for Iron is constant at 40 euros/ton. A technological innovation in the production process allows both firms to reduce marginal cost by 5 euros/ton. a) How much would each firm be willing to pay for the innovation, if it were the only firm to acquire it? b) Consider a situation where firms’ managers, simultaneously and non-cooperatively decide whether to acquire the innovation or not, which costs 900 euros, and then compete in quantities. What is the equilibrium of this game, based on its payoff matrix?