Who is only supplier of a good located in a particular town

Assignment Help Macroeconomics
Reference no: EM13212903

A firm, which is the only supplier of a good located in a particular town, is accused of engaging in anticompetitive tactics in order to protect its monopoly position in that town. As part of its defense, the firm has argued that the geographic antitrust market includes a larger neighbouring city with multiple firms. The defense offers two pieces of evidence in support of its larger geographic market: (1) the correlation coefficient between the price in the town and the nearby city is 0.95, looking at weekly prices for recent years, and (2) a recent survey of consumers in the town, conducted by the firm's marketing branch, revealed that a 5% increase in prices above current levels would be unprofitable because too many consumers would switch to purchasing from the city. In this larger geographic market, the firm's market share is low. Therefore, the defense claims, the firm does not have the market power necessary to carry out anticompetitive practices or to make them worthwhile. Offer a critique of the firm's arguments regarding market definition. Can we conclude that the relevant geographic market is larger than the town based on the evidence presented?

Reference no: EM13212903

Questions Cloud

What is the length of the slope of the ramp : Using the knon height and calculated base lenghth, what is the length of the slope of the ramp.
Calculate total cost of production for each of five outputs : The following table provides the total input requirements for each of five different total output levels: Q = 1 Q = 2 Q = 3 Q = 4 Q = 5 TECH. K L K L K L K L K L A 2 5 1 10 5 14 6 18 8 20 B 5 2 8 3 11 4 14 5 16 6 a.
Determine the acceleration of the cabinet : Determine the acceleration of the cabinet when sA = 40 ft. Note that when sB = 0, sA = 0 (points A and B are coincident).
State the hydrothermal fluids escape into the open seawater : why metal sulfide compounds can only form after the hydrothermal fluids escape into the open seawater.
Who is only supplier of a good located in a particular town : A firm, which is the only supplier of a good located in a particular town, is accused of engaging in anticompetitive tactics in order to protect its monopoly position in that town. As part of its defense, the firm has argued that the geographic an..
State a solution of glyceraldehyde a mass percentage : A solution of glyceraldehyde, C3H6O3, has a density of 1.15 g/mL, and a mass percentage of 28.1% glyceraldhyde at 25 deg C. (molar mass = 90.078g/mol)
Explain hydrogen cyanide and ammonia and calcium carbonate : Which element is the central atom? Hydrogen cyanide, Ammonia, Calcium carbonate, Magnesium sulfate
How to conclude that s2 is a rationalizable strategy : Suppose that in some two-player game, s1 is a rationalizable strategy for player 1. If s2 is a best response to s1, is s2 a rationalizable strategy for player 2? Explain Suppose that in some two-player game, s1 is a rationalizable strategy for pla..
What is bond rating : What is bond rating and what is the current price of these bonds if required rate is 12 per cent per annum?

Reviews

Write a Review

 

Macroeconomics Questions & Answers

  Asume that an individuals inverse demand for wireless

Asume that an individuals inverse demand for wireless services in the greater Atlanta.

  Elucidate the process by which a balance of payments deficit

Monetary approach, elucidate the process by which a balance of payments deficit is corrected under a flexible exchange rate system?

  What is the gdp per capita

What is Country A's GDP - What is the composition of GDP by percentage and what is the GDP per capita

  Illustrate the similar price elasticity of supply

Illustrate the similar price elasticity of supply, sellers would be able to pass along the smalles portion of a 10%tax on which item.

  To what peak if anyone does wal-mart feel itself affected

To what peak if anyone does Wal-mart feel itself affected by Federal tax policy

  Operate in the short run

The corresponding average total cost is $3.50 and total fixed costs equal $1,250. Based on this information, should this firm continue to operate in the short run? Please explain why your answer is yes or no.

  Elucidate each auto industry structure correctly

Elucidate each auto industry structure correctly. provide an analysis of market structure requirements including number of firms, uniformity of products.

  Gdp would help to predict the amount of inventory stock

Explain how one of the components of the GDP would help you to predict the amount of inventory to keep in stock if you were the owner of a retail store and were placing a merchandise order for the next few months.

  Estimate value of the benefit that each unit provides

The market demand for a public good can be determined by A)adding up how much each consumer is willing to pay for each unit of the public good. B) Adding up how much each citizen expects to consume at each possible price C) Adding up the total pri..

  Explain the comparative advantage enjoyed by each country

Develop a response that includes examples and evidence to support your ideas, and which clearly communicates the required message to your audience. Organize your response in a clear and logical manner as appropriate for the genre of writing. Use w..

  Describe free trade harm the environment

Describe free trade harm the environment. Environmentalists argue that trade liberalization harms the environment.

  Effects of the strategies on both gdp and unemployment

One government strategy to provide for economic stability and encourage economic growth is to provide tax reductions or tax incentives for individuals and businesses. An alternative approach is to increase government spending to accomplish these g..

Free Assignment Quote

Assured A++ Grade

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!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd