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Q. Firm 1 is the incumbent in a market lasting two periods with inverse demand curve p=74 -9Q. Its first-period costs are C(q) =15 +20q and it faces entry in the second period by Firm 2, which has identical costs. There is an asymmetry between the firms, however, in which only Firm 1 has the option of investing $63.5 in R&D in the first period in order to reduce its second-period marginal costs to $2 per unit. Explain which it would not be optimal for Firm 1 to make the investment if there were no threat of entry. Also explain how which it is optimal for Firm 1 to make this investment even though Firm 2 enters regardless.
Increasing the minimum wage will result in a decrease in employment for workers who now earn less than the new minimum wage.
Find the equation of the dominant firm's derived-demand function
The banking system is a fractional reserve banking system with a desired reserve deposit ratio. Banking system is a fractional reserve banking system.
More than 85% of McDonald's restaurants around the world are owned by independent franchisees.
The Coca-Cola Company has 40% of the cola market. Determine the probability that a sample proportion
If you want to make four equal payments on each January 1 from 2013 through 2016 to accumulate the $1,000, how large must each payment be.
Fred's Fashion Accessories of New Jersey produces jewelry for sale in Boston and New York subject.
Clarify what happened to the profit maximizing output rate when input costs were increased.
At this level of pollution, what is the marginal cost of pollution control.
Under what situation would Gore be better off giving Bush a head start on putting mutually his presidential ticket.
Considering political disposition as an axis of product differentiation does vertical or horizontal differentiation best categorize it.
What is the impact of the shrinking world on whether small to medium sized businesses should engage in international trade.
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