Please show mathematical and any other additional information if you can.
The following is the inverse demand for shirts: P = 100 − 2(q1 +
q2), where q1 is the output of the incumbent firm and q2 is the
output of the entrant.
Let both the labor cost and capital cost per unit be 30, i.e., w =
r = 20. For firm 1, if output is > K, MC = 40 and MC = 40 for
entrant regardless.
In addition, let each firm have a fixed cost of F1 = F2 =
100.
a)Suppose the incumbent firm invests in capacity K1 show the
incumbent’s response function if output is less than K1 and when
output is greater than K1
b)Show the entrant’s best response function in stage 2.
c)If the incumbent commits to output K = 15, calculate the total
output for both firms and profit for each firm.
d)Supposing incumbent commits to an output K = 17 units as output
in stage 1, will the entrant enter the market? Should the incumbent
make this decision?
Please show mathematical and any other additional information if you can. The following is the inverse...
There are two incumbent firms, F1,F2 and also a potential entrant, F3. The steps of the game are: 1. F1 and F2 simultaneously choose outputs q1 ∈ R+ and q2 ∈ R+ respectively. 2. F3 observes q1, q2 and then chooses whether to enter the industry. If she does not, then q3 = 0 and she gets a payoff of zero, but. . . 3. if she has entered the industry, F3 chooses her own output level, q3 ∈ R+....
Suppose two firms compete by selecting quantities q1 and q2, respectively, with the market price given by p = 1000-3q1 -3q2. Firm 1 (the incumbent) is already in the market. Firm 2 (the potential entrant) must decide whether or not to enter and, if she enters, how much to produce. First the incumbent commits to its production level q2. The potential entrant, having seen q1, decides whether to enter the industry. If firm 2 chooses to enter, then it selects...
There are two incumbent firms, F1,F2 and also a potential entrant, F3. The steps of the game are: 1. F1 and F2 simultaneously choose outputs q1 ∈ R+ and q2 ∈ R+ respectively. 2. F3 observes q1, q2 and then chooses whether to enter the industry. If she does not, then q3 = 0 and she gets a payoff of zero, but. . . 3. if she has entered the industry, F3 chooses her own output level, q3 ∈ R+....
There are two incumbent firms, F1,F2 and also a potential entrant, F3. The steps of the game are: 1. F1 and F2 simultaneously choose outputs q1 ∈ R+ and q2 ∈ R+ respectively. 2. F3 observes q1,q2 and then chooses whether to enter the industry. If she does not, then q3 = 0 and she gets a payoff of zero, but... 3. if she has entered the industry, F3 chooses her own output level, q3 ∈ R+. Inverse demand is...
Can you please help me out with this problem? Thank you!!! A market demand function is P= 100 - Q. MC = 40. Total revenues =P*Q = (100 - Q)*Q= 100Q – Q2. Therefore Marginal Revenue = dTR/dQ = 100 – 20. a. At P=MC, what is the price and quantity sold? b. What is the profit-maximizing price and quantity for a single firm? Imagine there are two identical firms, selling the same product and with the same MC =...
A monopolist can produce at a constant average (and marginal) cost of AC MC 5 It faces a market demand curve of Q-71-P Calculate the profit-maximizing price and quantity for this monopolist. Also calculate its profits. The monopoly would produce units of output at a price of (Enter numeric responses using real numbers rounded to two decimal places.) In turn, the monopoly would earn profit of $ Suppose a second firm enters the market. Let Q1 be the output of...
Hello, could you solve Question3 - Part 3 (the third question) please, Thank you very much! Question 3 A monopolist can produce at a constant average and marginal cost of ATC- MC demand demand curve given by Q-53-P. $5. It faces a market 1. Calculate the profit maximizing price and quantity for this monopolist. Also calculte its profits. 2. Suppose a secod firm enters the market. Let Q1 be the output of the first firm and Q2 be the output...
Reference the following information about the market demand function for questions 1 to 15. These questions are on different types of market structures – monopoly, perfect competition, Cournot oligopoly market, and the Stackelberg oligopoly market. The market demand function is given the following equation: P = 1600 – Q where Q is the industry’s output level. Suppose initially this market is served by a single firm. Let the total cost function of this firm be given the function C(Q) =...
Please solve and show full work for a rating. Thank you. Plastic bags are great 2) The production of plastic bags is given by the production function q K is capital and L is labor. f(LK) s, where Short Run Production a. ) Find the expressions for the Marginal Product of Labor (MP) and Average Product of Labor (APL) in the Short Run, when K is fixed at 400. i) Derive L() in the Short Run, again with K fixed...
2. You are given the following information: Hours of labor Units of output Marginal product 15 a) Complete the table. b) Show that the production process is subject to diminishing returns. c) Find the optimal level of labor, if output sells for $20 per unit and labor costs $40 per hour. 3. A perfectly competitive manufacturer of tires has the following cost functions: Total cost = C = 100 + 25Q+Q2 and Marginal cost = MC = 25 + 20...