4. (10 points) Assume that the demand for Pepsi is Qp 54 - 2Pp + Pc....
Suppose the demand for Pepsi is qp = 54 - 2pp + 1p. The demand for Coke is qc = 54 - 2pc + 1pp. Each firm faces a constant marginal cost of zero. Determine the Bertrand equilibrium prices. What happens to the Bertrand equilibrium prices and profits if increased differentiation causes the demand for Pepsi to become qp = 104 - 2pp + 1pc while the demand for Coke remains unchanged?
Please for provide step by step solutions 1.Suppose that Pepsi and Coke are competing in a horizontally differentiated Bertrand market and setting prices. Coke face marginal cost MCc = 6 and pespsi faces marginal cost MCp = 4 (a) Write the equation for the demand for coke in terms of price Pc as a function of Pp and Qc. (b) Determine the marginal revenue for Coke as a function of Pp and Qc. (c) Find the equation tha ttells how...
Coke and Pepsi compete in price competition. However, their products are differentiated – people can taste the difference! Demand for Coke is given by Qc= 28-4Pc+0.1Pp. Demand for Pepsi is given by Qp = 24-2Pp+0.1Pc. The (constant) marginal cost for Coke is 3. The (constant) marginal cost for Pepsi is 4. What is the equilibrium price of Coke in this one-shot, simultaneous move game? Give your answer to two decimal places, for example, XX.XX.
pls answer as many qwuestions!! 1. A market has an inverse demand curve and four firms, each of which has a constant marginal cost of. If the firms form a profit-maximizing cartel and agree to operate subject to the constraint that each firm will produce the same output level, how much does each firm produce? 2. Duopoly quantity-setting firms face the market demand curve. Each firm has a marginal cost of $60 per unit. a. What is the Nash-Cournot equilibrium?...
Two firms are price-competing as in the standard Bertrand model. Each faces the market demand function D(p)=50-p. Firm 1 has constant marginal cost c1=10 and firm 2 has c2=20. As usual, if one of the firms has the lower price, they capture the entire market, and when they both charge exactly the same price they share the demand equally. 1. Suppose A1=A2={0.00, 0.01, 0.02,...,100.00}. That is, instead of any real number, we force prices to be listed in whole cents....
Part 1: Short Answer Questions (10 points each) 1) The estimated Canadian processed pork demand and supply functions are as the follow- ings: Qp = 100-3 p + 3 p + 5 + 2 Y, Os = 100 + 6 - 8 PA where Q is the quantity in million kilograms (kg) of pork per year; p is the dollar price per kg, Po is the price of beef per kg, pe is the price of chicken per kg, P,...
Pricing is provided in the question. 1. Pricing along the mile-long road (30 points) Two stores selling bottled water, Goodwater and Sweetwater are located at the two extreme ends of a mile-long road. 100 customers are uniformly distributed along this road. The problem faced by the two stores here has to do with the pricing of bottled water. Owners of the two stores are aware of the following: (Figure 1) • Sweetwater charges Ps per bottle and Goodwater charges PG...
1) Decreasing returns to scale may occur as increasing the amount of inputs used A) increases specialization B) may cause coordination difficulties. C) always increases the amount of output produced D) increases efficiency. 2) Which of the following statements is NOT true? A) AFC = AC - AVC C) AVC = wage/MPL B) AC = AFC + AVC D) C=F-VC 3) The more elastic the demand curve, a monopoly A) will have a larger Lemer Index. will face a lower...
Question 111 pts Assume that individuals are homogeneous and that each has a demand curve of the following form for internet service: p=50-2q where p is the price per hour and q is hours per month. Assume the firm has a constant marginal cost of $12. The profit maximising two-part tariff results in the firm setting a per unit price equal to ______ and earning ________ profit from each consumer: Group of answer choices 12: 361. 12: 589: 31: 361....
usion (24 points) Two firms are playing a repeated Bertrand game infinitely, each with the same marginal cost 100. The market demand function is P-400-Q. The firm who charges the lower price wins the whole market. When both firms charge the same price, each gets 1/2 of the total market. I. Coll A. (6 points) What price will they choose in the stage (only one period) Nash equilibrium? What price will they choose if in the stage game (only one...