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!
Suppose the ABC chemical company discovers a drug that cures the common cold. ABC has plants in Europe and in the United States and can produce the drug in either continent at a marginal cost of 10. There are no fixed costs. Where P = price, Q = quantity and subscripts E and U refer to Europe and the US respectively, the firm faces the following demand curves in the two continents: Europe: QE=70-PE US: QU=110-PU 1. Assuming that the firm is a profit maximiser and that it can engage in third degree price discrimination, what price will it charge in each continent? Explain the intuition of the result.
2. What profits does it earn?
3. Now assume that the governments of the two continents agree to forbid price discrimination on the basis that it harms consumers. ABC must now charge a single price, the same in Europe and the US. What price will it choose? What profits will it earn? (Hint: because there is a single price, you need to consider the demand curve for the total market, Europe plus the US).
4. Who gains and who loses when price discrimination is forbidden?
Imputed values included in GDP are the: A) market prices of goods and services. B) estimated value of goods and services that are not sold in the marketplace. C) price of
Q. Describe Exports and imports in AS-AD model? Exports and imports. This is more difficult to justify owing to exchange rate. Suppose that we have a flexible exchange rate a
in the keynesian cross assume that the consumption function is given by c=200+0.75(y-t). given planned investment is 100, government purchases and taxes are both 100. then what i
In The No-Trade Equilibrium Stormlands: WageL = 24 WageW = ? MPLL = 4 MPLW = ? PL = ? PW = 4 Reach: Wage*L = ? Wage*W = 6 MPL*L = ? MPL*W = 1 P*L = 3 P*W = ? (a) Which
Trade in Services - strategic considerations: India has emerged as a major exporter of services, bringing about a change in our negotiating position at the WTO. India's trade
Consider an economy with the following characteristics: i. The price-level is fixed ii. The economy is closed (Exports - Imports = 0) iii. Government spending (G) and Inve
In the late 1990s, a growing number of economists expressed concern that the world policy makers were often focusing too much on fighting inflation, without fully taking into accou
Aggregate demand in the cross model Because C and Im depends positively on Y while G, I and X are exogenous, aggregate demand Y D will depend positively on Y: Y D (Y) = C(
Consider the following model of an economy that begins in a macro equilibrium,
Explain the multiplier effect with example Deposits and loans in banks give rise to an important multiplier effect. We use a simple example to illustrate this effect. Consider
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: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd