Homework Answers
a. Firm A profits= $1000
Firms B profits= $1000
reason- when firms collude their Profit will be maximum.
b. Firm A profit=$1250
Firm B profit= $300
reason- When one firm A cheats it will lower the price and firm B will keep high prices.
c. Firm A Profit=$700
Firm A strategy= Low price
Firm B strategy= Low price
Firm B Profit= $700
reason- When both firms act independently there Dominant strategy is to keep price low.
So profit for both firms is $700.
d. Firm B strategy= Low price
Firm B profit= 1250
Reason- when Firm A always keeps High price it is more beneficial for firm B to keep low prices.
If it helps kindly upvote
Add Answer to:
HdPre LI A-100 A-1250 High Price B-1000 R Firm B A-300 A700. Lower B-1250 B-700 a....
Question 43 10 pts (10 marks: 1 mark each) Use the following payoff matrix for a...
Question 43 10 pts (10 marks: 1 mark each) Use the following payoff matrix for a 2-firm oligopoly to answer the questions below Firm A: High Price Low Price A-1000 A-1250 High Price B = 1000 B = 300 Firm B: A-300 A = 700; Low Price B-1250 B-700 a. If the two firms above collude, the profits for each of the 2 firms would be: Firm A Profits Firm B Profits a. If the two firms above collude, the...
(10 marks: 1 mark each) Use the following payoff matrix for a 2-firm oligopoly to answer...
(10 marks: 1 mark each) Use the following payoff matrix for a 2-firm oligopoly to answer the questions below Firm A: High Price Low Price A = 1000: A = 1250; High Price B = 1000 B = 300 Firm B: A = 300; A = 700; Low Price B = 1250 B = 700 a. If the two firms above collude, the profits for each of the 2 firms would be: Firm A Profits Firm B Profits b. Suppose...
Firm B High Price Low Price High Price A:8 B:8 A;3 B:20 Low Price A:20 B:3...
Firm B High Price Low Price High Price A:8 B:8 A;3 B:20 Low Price A:20 B:3 A:6 B:6 *Firm A on Left, Firm B on top - What is the PV of profits if the firms collude successfully assuming an interest rate of 15%? - What is PV of profits for Firm A if it defects from the collusive behavior assuming an interest rate of 15%?
Firm B Low Price High Price Low Price 100, 100 600,50 High Price 50, 600 500,...
Firm B Low Price High Price Low Price 100, 100 600,50 High Price 50, 600 500, 500 Is there a dominant strategy for firms A and B? If so, what are these strategies? What payoff will each firm receive? Is this a prisoner's dilemma? What is the cooperative outcome? What is the noncooperative outcome? If they cooperate is there an incentive to cheat? Explain
Mathematical Question 3 (30pts) 3. Consider two firms are performing Cournot price competition in two differentiated...
Mathematical Question 3 (30pts) 3. Consider two firms are performing Cournot price competition in two differentiated goods markets. Firm 1 produces goods 1, and firm 2 produces goods 2, and two market demand functions are given by 91 (P1,P2) = 12-2p1 + P2 and 921,P2) = 12-2p2 + P 1. Furthermore, assume that the two firms have the same cost function such that fixed cost is $20 and variable cost is zero. a. (10pts) Calculate the equilibrium prices, quantities and...
This is the FOURTH time I'm posting this question please post the full answer of ALL parts A,B,C,...
This is the FOURTH time I'm posting this question please post
the full answer of ALL parts A,B,C,D,E. If you can't ,allow
somebody else to do it.Thank you!
3. Two firms produce luxury sheepskin auto seat covers, Western Where (WW) and B.B.B. Sheep (BBBS). Each firm has a cost function given by: C()30q +1.5q. The markei demand for these soai covers is reprsenid by h inverse demand equation: p-300-30, where 9-+ total output a) Calculate the profit-maximizing price and quantity...
1l. If a monopolistically competitive firm is incurring losses, then at the profit-max a price is above the average total cost curve. b. price is below the average total cost curve c. price is equal...
1l. If a monopolistically competitive firm is incurring losses, then at the profit-max a price is above the average total cost curve. b. price is below the average total cost curve c. price is equal to marginal revenue. d. price is less than marginal revenue. e. average total cost equals marginal cost. Both competitive and monopolistically competitive firms a. can maximize profit by raising price. b. cannot control or set their own price c. can maximize profit by producing to...
I need a written explanation for the following questions. Pad 2:10 AM * 100% Econ 2201...
I need a written explanation for the following questions.
Pad 2:10 AM * 100% Econ 2201 Professor Greenberg HW #9 1) Imagine a one-shot, three-player, sequential game between two firms in an oligopoly market and a third firm which is considering joining the market. The first firm can choose to set a low, medium, or high price. The second firm observes the pricing decision of the first firm and has the same three strategies available for their price. Then, based...
Firm A and Firm B compete in the sale of a product with market inverse demand...
Firm A and Firm B compete in the sale of a product with market inverse demand given by P(0) = 160-Q, where Q is market output, and Q = qA + qB (8a-Firm A's output, qB-Firm B's output). Firm A's Total Cost function is given by TCA(qA) 10qA and Firm B's is given by Find the value of Q when Firms A and B Cournot compete to maximize profits (i.e when they simultaneously determine profit maximizing output). At what price...
This problem set is partitioned into four sections. Section I examines price discrimination in the airline...
This problem set is partitioned into four sections. Section I examines price discrimination in the airline industry. Section II uses game theory to analyze output behavior of rivals. Section III uses game theory to examine output behavior of rivals for a multi-period game. Section I: Monopoly pricing 4. Firm X has a complete monopoly over the production of nutmeg. The following information is given: Marginal revenue = 1500 -20Q Marginal cost = 300 +10Q Where Q equals the output of...
Question 43 10 pts (10 marks: 1 mark each) Use the following payoff matrix for a 2-firm oligopoly to answer the questions below Firm A: High Price Low Price A-1000 A-1250 High Price B = 1000 B = 300 Firm B: A-300 A = 700; Low Price B-1250 B-700 a. If the two firms above collude, the profits for each of the 2 firms would be: Firm A Profits Firm B Profits a. If the two firms above collude, the...
(10 marks: 1 mark each) Use the following payoff matrix for a 2-firm oligopoly to answer the questions below Firm A: High Price Low Price A = 1000: A = 1250; High Price B = 1000 B = 300 Firm B: A = 300; A = 700; Low Price B = 1250 B = 700 a. If the two firms above collude, the profits for each of the 2 firms would be: Firm A Profits Firm B Profits b. Suppose...
Firm B Low Price High Price Low Price 100, 100 600,50 High Price 50, 600 500, 500 Is there a dominant strategy for firms A and B? If so, what are these strategies? What payoff will each firm receive? Is this a prisoner's dilemma? What is the cooperative outcome? What is the noncooperative outcome? If they cooperate is there an incentive to cheat? Explain
Mathematical Question 3 (30pts) 3. Consider two firms are performing Cournot price competition in two differentiated goods markets. Firm 1 produces goods 1, and firm 2 produces goods 2, and two market demand functions are given by 91 (P1,P2) = 12-2p1 + P2 and 921,P2) = 12-2p2 + P 1. Furthermore, assume that the two firms have the same cost function such that fixed cost is $20 and variable cost is zero. a. (10pts) Calculate the equilibrium prices, quantities and...
This is the FOURTH time I'm posting this question please post
the full answer of ALL parts A,B,C,D,E. If you can't ,allow
somebody else to do it.Thank you!
3. Two firms produce luxury sheepskin auto seat covers, Western Where (WW) and B.B.B. Sheep (BBBS). Each firm has a cost function given by: C()30q +1.5q. The markei demand for these soai covers is reprsenid by h inverse demand equation: p-300-30, where 9-+ total output a) Calculate the profit-maximizing price and quantity...
1l. If a monopolistically competitive firm is incurring losses, then at the profit-max a price is above the average total cost curve. b. price is below the average total cost curve c. price is equal to marginal revenue. d. price is less than marginal revenue. e. average total cost equals marginal cost. Both competitive and monopolistically competitive firms a. can maximize profit by raising price. b. cannot control or set their own price c. can maximize profit by producing to...
I need a written explanation for the following questions.
Pad 2:10 AM * 100% Econ 2201 Professor Greenberg HW #9 1) Imagine a one-shot, three-player, sequential game between two firms in an oligopoly market and a third firm which is considering joining the market. The first firm can choose to set a low, medium, or high price. The second firm observes the pricing decision of the first firm and has the same three strategies available for their price. Then, based...
Firm A and Firm B compete in the sale of a product with market inverse demand given by P(0) = 160-Q, where Q is market output, and Q = qA + qB (8a-Firm A's output, qB-Firm B's output). Firm A's Total Cost function is given by TCA(qA) 10qA and Firm B's is given by Find the value of Q when Firms A and B Cournot compete to maximize profits (i.e when they simultaneously determine profit maximizing output). At what price...
Most questions answered within 3 hours.
-
Why has California been the favorite destination of large number
of secondary migrants?
asked 24 minutes ago -
Do not neglect the old for the new. The existing business must
not lose priority simply...
asked 3 hours ago -
Kylie is a single mom with two dependent children,
Tanner, age 7 and Olivia, age 11....
asked 4 hours ago -
Phosphorous + bromine = phosphorous tribromide. If 35.0 g of
bromine are reacted and 27.9 grams...
asked 6 hours ago -
Derive the long wavelength limit of the Planck energy density
distribution
asked 6 hours ago -
Calculate the pH of each of the following solutions.
0.50 M HBr
3.1×10−4 M KOH
4.2×10−5...
asked 9 hours ago -
For the year ended December 31, Depot Max’s cost of merchandise
sold was $85,600. Inventory at the...
asked 9 hours ago -
Week 10 - Professional Memo Assignment
Professional Memo Assignment
Your mission for this week, should you...
asked 9 hours ago -
Write a Python program that stores the data for each
player on the team, and it...
asked 9 hours ago -
In
the last 3 months, mike never knows when he is going to get his
allowance...
asked 10 hours ago -
Is Ca(OH)2 a Bronsted base, Lewis base, or both? Why?
asked 10 hours ago -
1A- Why don’t voters complain about U.S. tariffs on imported
sugar?
Because sugar is only a...
asked 10 hours ago