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!
A dominant firm in an industry has costs given by C = 70 + 5qL. The dom- inant firm sets the market price, and the eight "small" firms coexisting in the market take this price as given. Each small firm has costs given by C = 25 + q2 - 4q. Total industry demand is given by Qd = 400 - 20P.
a. Create a spreadsheet similar to the example to model price setting by the dominant firm. (If you completed Problem S1 of Chapter 7, you need only make slight modifications in that spreadsheet.)
b. Experiment with prices between P = 7 and P = 16. For each price, determine the small firms' supply by setting q such that P = MC. Taking into account the supply response of the eight other firms, what price seems to be most profitable for the dominant firm?
c. Use your spreadsheet's optimizer to find the dominant firm's optimal price. (Hint: Adjust cells B8 and B14 to maximize cell I8 subject to the constraint G14 equal to zero.)
A
B
C
D
E
F
G
H
I
J
1
2
Dominant Firm
3
Price Leadership
4
5
Market Supply & Demand
6
Price
# S. Firms
Qs
Qd
Qd - Qs
Cost
Profit
7
8
48
240
192
1030
506
9
10
11
Small Firms
12
q
MC
AC
P - MC
Firm Profit
13
14
37
6.167
0
11.0
15
16
17
Small Firms' supply is determined by P = MC.
18
Large Firm maximizes profit given net demand.
19
What are the main elements of classical liberal explanations of growth and development? Compare the internal and external explanations of development and stagnation.
When her income falls from $50,000 to $20,000, Alex increases her monthly purchase of hamburger from 20 pounds to 35 pounds. Using the midpoint method, Alex's income elasticity of demand for hamburgers is:
the basic question in this case is whether airbus and boeing should work together to develop a new vlct airframe or
The table immediately below shows the national accounts for an imaginary economy. The Expenditure-based estimate of the economy's GDP? The amount of Capital depreciation experienced by the economy? How did you find this? The Income-based estimate of ..
Prove that every trembling-hand perfect equilibrium (for the agent normal form) is sequential. Show by example that the converse is false.
supply demand amp government in the marketsa doctoral student has just completed a study for her dissertation and
Merchant banking refers to:Banking services that are only available to retail merchants.Banking services that are only available to business but not the general public.
What components of GDP (if any) would each of the following transactions affect. Explain. A family buys a new refrigerator, You buy a pizza, California repaves Highway 101, Your parents buy a bottle of French wine.
Why the focus in interest rates and unemployment and why can they keep the interest rates low? How do bond purchases tie in with the interest rates?
the sec regulations require u.s. corporations to publish operating results on a quarterly basis. how does this short
Select an article from any Australian news websites or newspapers(e.g. Financial Review, The Age, and Sydney Morning Herald). Ensure that the article you choose contains news/information/description about: (a) Competition and the nature of competitiv..
Although Ken Brown (discussed in problem 3-16) is the principal owner of Brown Oil, his brother Bob is credited with making the company a financial success. Bob is vice president of finance.
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