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!
Two firms compete in a homogenous product market where the inverse demand function is P = 10 - 2Q (quantity is measured in millions). Firm 1 has been in business for 1 year, while firm 2 just recently entered the market. Each firm has a legal obligation to pay one year's rent of $1million regardless of its production decision. Firm 1's marginal cost is $2, and firm 2's marginal cost is $6. The current market price is $8 and was set optimally last year when firm 1 was the only firm in the market. At present, each firm has a 50 per cent share of the market.
a. Why do you think firm 1's marginal cost is lower than firm 2's marginal cost?
b. Determine the current profits of the two firms.
c. What would happen to each firm's current profits if firm 1 reduced its price to $6 while firm 2 continued to charge $8?
d. Suppose that, by cutting its price to $6, firm 1 is able to drive firm 2 completely out of the market. After firm 2 exists the market, does firm 1 have an incentive to raise its price? Explain.
e. If firm 1 engaging in predatory pricing when it cuts its price from $8 to $6? Explain.
This time of year we all here about football. For me it is the bad news of how poorly the Buffalo Bills are performing. Hopefully your favorite team is doing well. One thing we
On May 9th, David paid $34,500 (including sales tax) to purchase a used Audi A8 that he uses 90% of the time for business. No trade-in was involved. David uses the actual operating
Methods of Cost Estimation We will consider given cost estimation methods commonly employed, namely as: a. High Low Activity method b. Engineering Analysis c. Account
Mandy Building Contractors Ltd signed a fixed-price contract to build a bridge for Nelly Ltd for $110 million on 1 July 2012. Contract costs are estimated as follows:
explain one operation: unit or output cost
Sales Budget It provides volume of sales and sales mix of the recent operations. The sales forecast is initially prepared and upon completion the sales budget is finalized. Th
In this section we have tried to develop the concept of flow of funds inside the organization. Starting along with the funds requirement for an organization, we have tried to trace
OBJECTIVES OF COST ACCOUNTING : 1-DETERMINING SELLING PRICE 2-CONTROLING COST 3- PROVIDING INFORMATION FOR DESING MAKING 4-ASCERTAINING COSTING PROFIT 5-Facilitating preparation of
how to prepare that project
Igor and Angela were married in 2005, separated in 2011, and divorced recently. At the time of marriage, each had some investments and personal assets. They both worked during the
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