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A single firm monopolises the entire market for widgets and can produce at constant average and marginal costs of €10.Originally, the firm faces a market demand curve given by Q=60−P. a. Calculate the profit-maximising price and quantity for the monopoly. What are the firm’s profits? b. If the demand curve shifts to Q=45−0.5P determine the […]

As wine ages, its value increases. One Euro of wine at year 0 is worthEuros at time t. If the interest rate is 5 per cent, after how many years should a vineyard sell wine in order to maximise the PDV of this sale?

The Herfindahl index which is used to measure market concentration is defined as where st=qi/Q is firm i’s market share. The higher is H, the more concentrated the industry is said to be. a. Determine the Nash equilibrium of this n-firm Cournot game. Also compute market output, market price, consumer surplus, industry profit and total

Suppose that a medical device is produced at constant average and marginal cost of €10 and that the demand for the device is given by The market meets each period for an infinite number of periods. The discount factor is δ. a. Suppose that n firms engage in Bertrand competition each period. Suppose it takes

Two firms have costs of AC1=MC1= 20 and AC2=MC2=16 respectively. Market demand is Q=1000−40P. a. Suppose firms practice Bertrand competition, that is, setting prices for their identical products simultaneously. Compute the Nash equilibrium prices. (To avoid technical problems in this question, assume that if firms both have the same price, then the low-cost firm makes

Use the first-order condition (Equation 15.2) for a Cournot firm to show that the usual inverse elasticity rule from Chapter 10 holds under Cournot competition (where the elasticity is associated with an individual firm’s residual demand, the demand left after all rivals sell their output on the market). Manipulate Equation 15.2 in a different way

How are political parties differentiated according to the article by Diamond and Gunther? Sample Solution The post How political parties are differentiated appeared first on ACED ESSAYS.

Demographic variables are widely used by marketers to learn about their customers’ differences in terms of age, income, gender, generations…etc. write a minimum of 7 pages APA formatted paper discussing the differences between generation Y (Gen Y) and generation Z (Gen Z) in terms of their shopping behavior, buying habits, and attitudes toward brands and

Suppose the production possibility frontier for an economy that produces one public good (y) and one private good (x) is given by This economy is populated by 100 identical individuals, each with a utility function of the form where xi is the individual’s share of private good production (=x/100). Notice that the public good is nonexclusive

Suppose a monopoly produces a harmful externality. Use the concept of consumer surplus in a partial equilibrium diagram to analyse whether an optimal tax on the polluter would necessarily be a welfare improvement.