(See attached file for full problem description) --- 8. A monopolist's Demand function is P=1624-4Q and its Total Cost function is TC=22,000+24Q-4Q2 +1/3Q3, where Q is output produced and sold. a) At what level of output and sales (Q) and price (P) will Total Profits be maximized? b) At what level of output and sales
1. Discuss whether demand, equilibrium price, and quantity increases or decreases for gas and red meat, respectively, in the following two scenarios. (1) Consumers expect the price of the gas to be higher in the future (2) A medical report is published showing that red meat is hazardous to your health
Illustrate and explain how the profit maximizing level of production and is determined in perfect competition. Illustrate and explain what it means for the market to move towards a long-term equilibrium condition.
(See attached file for full problem description) --- Part A: I attempted to find the profit-maximizing output and I got 42.857. From there I came up with a price of -25.71 (I don't feel that this is correct). After that I tried to find the profit, but when I went back to substitute my quantity (Q1) back into the profit equat
No idea how to start this game tree? *************************************** Bank run game...here's the info: 2 players: each deposits $100 The bank invests this $200 2 dates at which investors can withdraw: Date 1: investment does not reach maturity Date 2: investment does mature At each date, both investors s
Is there a satisfactory theory that describes behaviour of oligopolies discuss?
Suppose all of the firms in a small sconomy satisfy the conditions for efficiency except for one firm, LuthorCorp, which is a monopolu producer of computer anti-virus programs. LuthorCorp is also the only hirer of anti-virus program engineers in this economy. Suppose the production function for anti-virus program is Q=F(L)=2L, w
Please see the attached file.
Suppose Firms A and B sells competing products and is deciding whether to undertake advertising campaigns. Each firm will be affected by its competitor decision. The possible outcomes of the game are illustrated by the payoff matrix below.
Dominant Strategy (see attached document). Thank you.
Let's derive a few more results based on our ongoing white-collar / blue-collar, energy / food example (as covered in class last Wednesday and summarized further in the "Addendum" nibble in Coursework). In answering the following questions, you may refer to your class notes and the Addendum. You don't need to do any calculus
There is a vast number of hog farmers in Canada. The Industry should be a good approximation to a perfectly competitive market. The demand for processed pork in Canada is: The D should be subscript QD = 286-20p, where QD = quantity of pork demanded in millions of kg per year p = the price of pork in Canadian dollars per kg
Assume that a firm sells its product in a perfectly competitive market. The firm's fixed costs (including a "normal" return on the funds the entrepreneur has invested in the firm) are equal to $100 and its variable cost schedule is as follows: Output (Units) Variable Cost per Unit 50 $5.00 100 4.50 150 4.00 200
Assume that a firm in a perfectly competitive industry has the following total cost schedule: Output (units) Total Cost ($) 10 $110 15 150 20 180 25 225 30 300 35 385 40 480 a. Calculate a marginal cost and an average cost schedule for the firm. b. If the prevailing market price is $17 pe
Explain which of these changes represent a move along the IS curve and/or which represent a shift of the IS curve and why. PLEASE DO NOT ANSWER UNLESS YOU THOROUGHLY UNDERSTAND IS CURVES (a) Stock market boom boosts consumption and investment (b) Government cuts taxes by $50 billion (c) Government passes $50 billion p
A "One might expect firms in a monopolistically competitive market to experience greater swings in the price of their products over the business cycle than those in an oligopoly market. However, fluctuations in profits do not necessarily follow the same pattern." Discuss this statement. B Market Structure Concepts: Ind
A. Do the U.S. antitrust statutes protect competition or competitors? What is the difference? B. The Hair Stylist, Ltd., has a monopoly in the College Park market because of restrictive licensing requirements, and not because of superior operating efficiency. As a monopoly, the Hair Stylist provides all industry output.
I'm doing practice problems for an exam in a game theory course and I want solutions by some one more knowledgeable, so that I could see if I did them right. I need all the problems in the file "supplement" done. I also need problems 5 and 9 from the file "problems 5 and 9", problem 3 from from file "problem 3" and problem 8 fr
Demonstrate graphically the likely effect of an increase in the price of gas on the equilibrium price and quantity of compact cars. *Compact care are mostly affordable* Inclue curves, axes, points.
In this problem, assume that Mexico and the United States have the same aggregate production function, the same δ (value for depreciation of capital stock), and the same n . In Mexico, real GDP per worker in 2000 is about 40% what it is in the United States, but Mexico is not near its steady-state level of output. 1. If
1 Carefully explain and show graphically how each of the following changes would effect the shape of the IS curve: a) The MPC becomes bigger. b) Investment becomes more sensitive to changes in the real interest rate. 2 In the State of the union address in January 2002, President Bush announced that he would ask Congress to
Here's what I think I know about the answer: to get the $ value of DWL you have to take the area of the aggregate surplus under perfect competition and substract the area of the aggregate surplus under monopoly (helps to make a little graph.) The funny thing is, my main problem is I don't know the geometry necessary to do that.
Please denote which letter best suits the answer to the question. 1. Microeconomics is the study of: A- the overall level of unemployment, output, and inflation in an economy B- how to increase our scarce resources C- how firms and individuals make economic choices and how those choices create mar
1. In what ways are firms' isoquant maps and individuals' indifference curve maps based on the same idea? What are the most important ways in which these concepts differ? 2. Bottles are produced according to the production function, q = 3K + L, where q = output per hour K = capital input per hour L = labor input per h
Consider the following game between Sony, a manufacturer of video cassette players, and Columbia Pictures, a movie studio. Each firm must decide whether to use the VHS or Beta format - Sony to make video players, Columbia to release its movies for rental or purchase. Columbia Pictures
(See attached file for full problem description) --- Reconsider the attached problem (prior problem), except suppose American and United take each other's quantity as given rather than taking each other's price as given. That is, assume that American and United act as Cournot competitors rather than Bertrand competitors. The
1. Suppose a monopolist faces the market demand function P = a - bQ. Its marginal cost is given by MC = c + eQ. Assume that a > c and 2b + e > O. a) Derive an expression for the monopolist's optimal quantity and price in terms of a, b, c, and e. b) Show that an increase in c (which corresponds to an upward parallel shift in
Please see the attached file. --- Suppose that in the domestic market for com¬puter chips the demand is pd = 110 - Qd, where Qd is the number of units of chips demanded domestically when the price is pd. The domestic supply is ps = 10 + QS, where QS is the number of units of chips supplied domestically when domestic supplie
(See attached file for full problem description) --- The market for commercial aircraft is dominated by two firms, Airbus (player A) and Boeing (player B). A crucial decision for each firm is that of introducing a new aircraft model. Let N (for "new") denote the strategy of introducing new models and let O (for "old") be t
The question asked that suppose that the consumption function in a particular economy is given by the following table: Disposable Income Consumption Expenditure (Billions of Dollars) (Billions of Dollars)