Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
In New Yotk, the demand for bottled spring water is given by Q = 121 − 1/2P . There is one known spring in town controlled by the bottler First Spring (FS). In other words, FS is a monopolist in the market for spring water. FS’s cost of production for gallons of water is C(Q) = 2Q. Suppose now that a new spring is discovered in State College. A bottler called New Spring (NS) gains exclusive rights to this spring and is deciding whether or not to set up operations and compete with FS. If NS decides to join the market, NS and FS will be Cournot competitors. Both firms will face the same production costs, whereby C(Q) = 2Q. Nevertheless, NS will have to pay a one time set up cost of $2,000.
1. Suppose that consumers created a Spring Water Authority (SWA) that would subsidize set up costs for new entrants. This subsidy would be funded directly (e.g. dollar-for-dollar) out of consumers’ surplus. Would consumers want the SWA to subsidize the set-up costs for New Spring? What would be the optimal amount of this subsidy? Explain.
2. Suppose that some time after New Spring is in operation, 3rd Spring is discovered near State College. 3rd Spring faces the same technology as its predecesors (e.g. C(Q) = 2Q) and a setup cost of $3,600. Would consumers vote to subsidize 3rd Spring’s set up costs? If so, what is the optimal level of subsidy?
Draw a new graph of labor market equilibrium and label values for the initial real wage and employment. Draw a graph of the firm’s marginal product of labor, assume a fixed value for the real wage, and describe how the firm decides how much labor to ..
Suppose that the quantity demanded for Windows 7 system is given by Q = 320 − 2P, where P is the price of the Windows 7. Let us assume that the total cost of producing Q units of Windows 7 is given by C(Q) = 500 + 0.5Q2. What is the price that Micros..
Do you think governments should step in and help an economy move to potential or are "markets" capable of fixing themselves? Carefully consider the impact of falling prices.
Consider the following situation for the US economy and answer the following questions. Suppose there are 10 million people living in the US. in 2013, Obama has to spend $8 per capita in wages to government employees and $2 per capita in government e..
In what ways and to what extent did coffee production contributed to the growth and development of the Brazilian economy before 1930.
If a company has a required WACC of 10% per year. it's stocks are expected to have a 16% rate of return. The capital structure of the company has to be 65% debt and 35% equity. the income tax rate of the company is 30%. What is the maximum annual cos..
When a country, say Greece, adopted the Euro as its currency, what happened to the debt that was based on the Drachma? Was it converted into Euros?
When a binding price ceiling is introduced into a market, economists generally expect what outcome?
A foundry uses 3,600 tons of pig iron per year at a constant rate. The cost per ton delivered to the foundry is $145. It costs $92 to place an order and $18 per ton per year for storage. Find the minimum-cost purchase quantity.
If the purchasing power of a dollar is less than the purchasing power of the euro, purchasing power parity would predict that
By how much will the quantity of Federal funds have to change for the equilibrium to occur at the new target rate?
Three policies used to restrict trade are: Tariffs, Quotas, and regulatory trade restrictions. Discuss pros and cons of each. If the government has to decide on one which one it will?
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd