Homework Answers
Add Answer to:
(5 pts) When firms choose quantities of output, as in the Cournot model, what happens to...
Suppose there are two firms in a market producing differentiated products. Both firms have MC=0. The...
Suppose there are two firms in a market producing differentiated products. Both firms have MC=0. The demand for firm 1 and 2’s products are given by: q1(p1,p2) = 5 - 2p1 + p2 q2(p1,p2) = 5 - 2p2 + p1 a. First, suppose that the two firms compete in prices (i.e. Bertrand). Compute and graph each firm’s best response functions. What is the sign of the slope of the firms’ best-response functions? Are prices strategic substitutes or complements? b. Solve...
Which of the following statements is correct? a. The Bertrand model is a game involving two...
Which of the following statements is correct? a. The Bertrand model is a game involving two identical firms, producing identical products at a constant marginal (and average) cost, and, simultaneously, choosing prices. b. The Cournot model is similar to the Bertrand model except that firms are assumed to simultaneously choose quantities rather than prices. c. The Stackelberg model is similar to a duopoly version of the Cournot model except that—rather than simultaneously choosing the quantities of their identical outputs—firms move...
15.2 where a, b > 0 a. Suppose that firms' marginal and average costs are constant...
15.2 where a, b > 0 a. Suppose that firms' marginal and average costs are constant and equal to c and that inverse market demand is given by P = a - bQ. Calculate the profit-maximizing price-quantity combination for a monopolist. Also calculate the monopolist's profit. b. Calculate the Nash equilibrium quantities for Cournot duopolists, which choose quantities for their identical products simultaneously. Also compute market output, market price, and firm and industry profits. c. Calculate the Nash equilibrium prices...
3. If a firm must reduce price in order to sell a larger output: a. the...
3. If a firm must reduce price in order to sell a larger output: a. the firm has some monopoly or market power b. MR >P c. the demand curve facing the firm is perfectly inelastic d. the firm is a price taker e. the firm is a natural monopoly 9. Assuming that there are two firms in the market, which of the following statements is accurate concerning equilibrium market output in the Cournot and Bertrand models? a. equilibrium market...
An industry consists of two Cournot firms selling a homogeneous product with a market demand curve...
An industry consists of two Cournot firms selling a homogeneous product with a market demand curve given by P=100-Q1-Q2. Each firm has a marginal cost of $10 per unit. (a) Find the Cournot equilibrium quantities and prices. (b) What is the Bertrand equilibrium price in this market? (c) Find the quantities and price that would prevail if the firms acted as if they were a monopolist (I.e. find the collusive outcome) and then find the equilibrium price and quantity that...
Cournot: Consider a Cournot duopoly in which firms A and B simultaneously choose quantity. Both firms...
Cournot: Consider a Cournot duopoly in which firms A and B simultaneously choose quantity. Both firms have constant marginal cost of $20 and zero fixed cost. Market demand is given by: P = 140 − qA − qB. (a) Derive the best-response functions for each firm and plot them on the same graph. (b) Calculate the profits of each firm in the Nash Equilibrium outcome.
This is one question and question "7" need the information in "5" Thank you. 5 Cournot Suppose there are two departments selling economics degrees in one market competing fol- lowing...
This is one question and question "7" need the information in
"5" Thank you.
5 Cournot Suppose there are two departments selling economics degrees in one market competing fol- lowing the rules of the Cournot Oligopoly Model econ and man. econ. Suppose market demand for an economics degree is 7200-2p. Suppose both departments marginal cost is $3000 per degree. What is each department's residual demand curve? 5.1 5.2 What is each department's best response functions? 5.3 What is the Nash-Cournot...
There are 2 firms in a market producing differentiated products. The firms both have MC that...
There are 2 firms in a market producing differentiated products. The firms both have MC that is equal to 0 Firm 1 demand is q1(p1,p2) = 6-2p1 + p2 Firm 2 demand is q2(p1,p2) = 6-2p2 + p1 1. Firms compete in quantities- Cournot Competition. What are the inverse demand functions for firm 1 and 2? 2. Find and graph each firm’s best response functions. The quantities are strategic substitutes or complements? 3. Find the Nash equilibrium prices and quantities...
1) In Cournot equilibrium each firm chooses the quantity that maximizes its own profits assuming that...
1) In Cournot equilibrium each firm chooses the quantity that maximizes its own profits assuming that the firm’s rival will continue to sell at the same price as before.In Cournot equilibrium each firm chooses the quantity that maximizes its own profits assuming that the firm’s rival will continue to sell at the same price as before. Q: Why it is false? 2) Suppose that the demand curve for an industry’s output is a downward-sloping straight line and there is constant...
The output effect refers to how Select one: a. firms choose their quantities. b. lower output...
The output effect refers to how Select one: a. firms choose their quantities. b. lower output affects the price. c. lower prices affect revenue. d. firms can set their prices. e. lower prices affect the quantity sold.
15.2 where a, b > 0 a. Suppose that firms' marginal and average costs are constant and equal to c and that inverse market demand is given by P = a - bQ. Calculate the profit-maximizing price-quantity combination for a monopolist. Also calculate the monopolist's profit. b. Calculate the Nash equilibrium quantities for Cournot duopolists, which choose quantities for their identical products simultaneously. Also compute market output, market price, and firm and industry profits. c. Calculate the Nash equilibrium prices...
This is one question and question "7" need the information in
"5" Thank you.
5 Cournot Suppose there are two departments selling economics degrees in one market competing fol- lowing the rules of the Cournot Oligopoly Model econ and man. econ. Suppose market demand for an economics degree is 7200-2p. Suppose both departments marginal cost is $3000 per degree. What is each department's residual demand curve? 5.1 5.2 What is each department's best response functions? 5.3 What is the Nash-Cournot...
Most questions answered within 3 hours.
-
Suppose a brewery has a filling machine that fills 12-ounce
bottles of beer. It is known...
asked 23 minutes ago -
For this problem, carry at least four digits after the decimal
in your calculations. Answers may...
asked 3 hours ago -
Ask a user for three positive integer numbers. Use an input
validation loop to make sure...
asked 3 hours ago -
The most primitive form of data from data analysis perspective
is a. nominal scale b. ordinal...
asked 3 hours ago -
The number of vacancies in some hypothetical metal increases by
a factor of 5 when the...
asked 3 hours ago -
The fiduciary duty that is predicated on the concept that a
board of directors and officers...
asked 3 hours ago -
Sustainable Growth Rate Last year Umbrellas Unlimited
Corporation had an ROE of 17.3% and a dividend...
asked 4 hours ago -
Write a MATLAB program to do the following:
Receive 5 input values and store them into...
asked 4 hours ago -
Which one of the following aqueous solutions would you expect to
have the largest conductance: (a)...
asked 4 hours ago -
(Intermediate Macroeconomics)
2.The aggregate supply function be ys=2000+P, and the aggregate
demand function be yD=2400-P。Find the...
asked 4 hours ago -
I am having a really difficult time developing a strong thesis
for this question....... To what...
asked 4 hours ago -
There are n street lights in a line. In order to conserve
energy, the city decides...
asked 4 hours ago