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An interesting example of strategic behavior comes from a 1997 article about Microsoft?s investment in Apple (New Straits Times, 1997). Facing tough anti-trust scrutiny from government agencies, Microsoft provided financial support to Apple in order to ensure Apple?s survival and, therefore, to ensure that competitiveness in the industry remains. Moreover, the partnership with Apple provided an additional market for Microsoft?s products ? the MS Office and the IE products were to be bundled with the MAC OS as one of the conditions for this financing. Discuss this case in the context of market structure and strategic behavior. What market structure do these firms operate in? Why did Microsoft need to preserve competitiveness in the industry? What was Microsoft afraid of in the event that Apple did not survive?
A nation has a fixed amount of Capital and Labor which lies on aggregate isoquant when all inputs are being used efficiently.
Sam consumes green eggs and ham. Ham and green eggs are both normal goods.
1) Name a good with a negative externality. What is the external cost? Will a free market for this good provide too much or too little to be allocatively? how can the government ensure an optimal amount to the good is produced?
Research in developing countries indicate that the incidence of child labor actually rose in some countries as incomes (and wages) of poor families increased. This is difficult to understand since many people assume that as incomes rose, the inci..
The Smith's Company's marketing manager has determine that the price elasticity of demand for its product equals -2.2. According to the studies he has performed, the relationship between the amount spent by firm on advertising and its sales as fol..
The scientific method is more difficult for economists than, say, chemists, because: a-controlled laboratory conditions are more problematic in economics. b-it is difficult to hold other factors that may affect the variables being studied constant in..
1. what is the regulation or statute for?2. who does the act protect?3. what are the consequences for violating it?4.
According to the aggregate expenditure function, as the price level decreases, it is reasonable to expect that the automonos and induced expenditures increase, only the autonomous expenditures increase or else.
A grocery store notices that the cross-price elasticity between ice cream and chocolate syrup is -.3. The store is advertising a sale with ice cream prices reduced by 20%. By how much should they expect chocolate syrup sales to increase?
Assume that you are an advisor to the United States section of Justice, the agency with responsibilities that include, among others, the power to approve or disapprove proposed business mergers in the U.S.
analyze the impact on the consumer's demand of the following three policies under the assumption that the market price does not change.
A restaurant industry has a market structure that comes closest to
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