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- 1.10 1.20 - 226 - 215 - 106 - 89 - 56 - 37 - 44 - 25 - 52 - 32 - 70 -51 - 93 -76 - 118 - 102 What are the firms' strategies? The firms pick O A. quantities. OB. profits. O C. advertising. O D. competition. OE. prices. Why is this situation an example of the prisoners' dilemma game? This game is a type of prisoners' dilemma because O A. the firms are rivals. O B. competing maximizes joint firm profits. O C. the game results in cooperation. Click to select your answer. P&G 1.10 1.20 1.30 1.40 1.50 1.60 1.70 1.80 1.30 - 204 - 73 - 19 -6 - 15 - 34 - 59 -87 1.40 194 - 58 2 4 12 3 - 18 -44 -72 1.50 - 183 - 43 15 29 20 -1 - 28 -57 1.60 - 174 - 28 31 46 36 14 -13 -44 1.70 - 165 - 15 47 62 52 30 1 -30 1.80 - 155 -2 62 78 68 44 15 - 17If two identical firms with no cost and demand curve P=20-2Q compete using the Cournot model, find price. Select one: a. 12.24. O b. 4.167. O c. 2.5. O d.4.Think about firms such as the Coca Cola Company and PepsiCo who competeagainst each other in the monopolistically competitive market for soft drinks. Eachfirm produces a unique product, but each of these unique products is to some extenta substitute for the soft drinks produced by rival companies.Now imagine a situation where the firms within such a market are facing suchextreme competition that they are unable to make an operating profit. Characterisethis situation diagrammatically and explain what will happen to the market, payingparticular attention to the exit or entry of firms out of (or into) the market.
- Firms J and K produce compact-disc players and compete againstone another. Each firm can develop either an economy player (E)or a deluxe player (D). According to the best available marketresearch, the firms’ resulting profits are given by the accompanyingpayoff table.a. The firms make their decision independently, and each is seeking itsown maximum profit. Is it possible to make a confident predictionconcerning their actions and the outcome? Explain.Firm KE DE 30, 55 50, 60 Firm JD 40, 75 25, 50b. Suppose that firm J has a lead in development and so can move first.What action should J take, and what will be K’s response?c. What will be the outcome if firm K can move first?Consider a market with 3 Cournot firms producing a homogeneous product. Consumer demand is given by P = 130 - Q. Each firm's total costs are given by C = f + 10g, where f represents fixed costs. Suppose that firms 1 and 2 merge and that after the merger, the merged firm has fixed costsof af with 1 < a< 2. Under which condition is this merger %3D profitable for the merging firms? O a. a< 2- 200/f O b. None of the options given are correct Oc a<2- 100/f O d. a <2- 150/f O e. a<2- 50/fRefer to the figure at right. Two firms operating in the same market must choose between a collude price and a cheat price. Firm A's profit is listed before the comma, B's outcome after the comma. If each firm tries to choose a price that is best for it, regardless of the other firm's price, which of these statements is correct? O A. Both firms should charge a cheat price. OB. Firm A should charge the collude price; Firm B should charge a cheat price. C. D. Both firms should charge a collude price. Firm A should charge a cheat price; Firm B should charge a collude price. Cheat Price Firm A Firm B Cheat Price Collude Price Collude Price 18, 18 6,30 30,6 24, 24
- Table 17-4 Only two firms, ABC and XYZ, sell a particular product. The following table shows the demand curve for their product. Each firm has the same constant marginal cost of $8 and zero fixed cost. O a. $5 O b. $15 Price (Dollars per unit) O c. $20 O d. $10 28 26 24 22 20 18 16 14 12 10 8 6 4 2 0 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 Refer to Table 17-4. How much less do each of these firms earn in the Nash equilibrium than if they jointly maximize profits? Quantity Demanded (Units) Total Revenue (Dollars) 0 130 240 330 400 450 480 490 480 450 400 330 240 130 0If two identical firms with marginal cost 5 and demand curve P=70-2Q compete using the Cournot model, find Q1. Select one: a. 4.167. b. 13.67. c. 1.94. O d. 4.2 clothing manufacturers, LE and LL B, are deciding what price to charge for very similar field coats. Cost of producing these coats is $100. The coats are very close substitutes, so customers swarm to the seller that offers the lowest price. If both firms offer the same prices, each receives half of the customers. Assume the two firms have the choice of pricing at prices of $103, $102, or $101. The profit each firm would earn at various prices is shown in the payoff matrix below $103 ($150, $150) ($0, $200) ($0, $120) Lands' End $102 ($200, $0) ($100, $100) ($0, $120) $101. ($120, $0) ($120, $0) ($50, $50) What is the Nash equilibrium and expected profits to LLB and LE of this game? If this was a mixed strategy game in which LLB has a 25% percent chance of choosing a price of $101, a 25% chance of choosing price of $102, and a 50% chance of choosing $103, while LE has a1/3 chance of…
- Kate and Alice are small-town ready-mix concrete duopolints. The market demand tunction is o- 20,000 - 200Pwhere Pis the price of a cubic yard of concrete and Ois the number of cubic yards demanded per year. Marginal cost is sa0 per cubic yard. Suppose Kate onters the market first and chooses her output belore Alice. What is the difference in Alice's profit when Kata enters the market tirst, compared to when they simultanecusly select ther outputa? When Kate entors the markat first, Alice's profit is $3,888.a0 lower. O When Kate enters the market fest, Alice's profit is 513,333.33 lower. O When Kate enters the market first, Alice's profit is $5,000 lower. O When Kate onters the market first, Alice's proft is $1.111.11 higher,Please help me ASAP. I will really appriciate it. Thank you Assume a Nash-Cournot equilibrium. How much output does firm 1 produce? Assume a Nash-Cournot equilibrium and no fixed cost. How much profit does firm 2 make? Now assume a collusive equilibrium. What is firm 1's output?The table shows the payoff matrix for two firms operating a zipline duopoly in a resort town. If the firms decide to compete, industry profits equal and both firms would offer Firm X's strategies rides each. 100 rides 60 rides O A. $9,000; 60 O B. $5,000; 60 $3,000 $1,000 OC. $9,000; 100 100 rides O D. $10,000; 320 $3,000 $6,000 O E. $6,000; 100 Firm Y's strategies $6,000 $5,000 60 rides $1,000 $5,000 Next