10. Questionable business practices according to antitrust agencies Complete the following table by indicating whether each of the scenarios describes the concept of tying, resale price maintenance, or predatory pricing. Scenario Coolaire is the only firm producing refrigerators. It costs $1,000 to produce a refrigerator, and Coolaire sells each refrigerator for $1,200. After Chillbox, a new firm with the same costs as Coolaire, enters the market for refrigerators, Coolaire starts selling its refrigerators for a price of $550. Rhythm is a firm that produces mp3 players. Suppose Rhythm sells its mp3 players to retail stores for $159 each and requires those retailers to charge customers at least $179 for each mp3 player. Snackyville sells a wide variety of snacks to retail grocery stores. Snackyville recently released two new snacks: a popular trail mix and a much less popular granola bar. Snackyville requires grocery Tying O Resale Price Maintenance O Predatory Pricing O

10. Questionable business practices according to antitrust agencies Complete the following table by indicating whether each of the scenarios describes the concept of tying, resale price maintenance, or predatory pricing. Scenario Coolaire is the only firm producing refrigerators. It costs $1,000 to produce a refrigerator, and Coolaire sells each refrigerator for $1,200. After Chillbox, a new firm with the same costs as Coolaire, enters the market for refrigerators, Coolaire starts selling its refrigerators for a price of $550. Rhythm is a firm that produces mp3 players. Suppose Rhythm sells its mp3 players to retail stores for $159 each and requires those retailers to charge customers at least $179 for each mp3 player. Snackyville sells a wide variety of snacks to retail grocery stores. Snackyville recently released two new snacks: a popular trail mix and a much less popular granola bar. Snackyville requires grocery Tying O Resale Price Maintenance O Predatory Pricing O

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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4. Questionable business practices according to antitrust agencies Complete the following table by indicating whether each of the scenarios describes the concept of tying, bottleneck, or predatory pricing. Scenario Snackyville sells a wide variety of snacks to retail grocery stores. Snackyville recently released two new snacks: a popular trail mix and a much less popular granola bar. Snackyville requires grocery stores to buy 15 cases of the granola bar for every 120 cases of the trail mix ordered. Heat-Em-Up is the only firm producing grills. It costs $410 to produce a grill, and Heat-Em-Up sells each grill for $950. After Well Done, a new firm with the same costs as Heat-Em-Up, enters the market for grills, Heat-Em-Up starts selling its grills for a price of $330. Union Southwest is a railroad company that built and owns the only bridge to and from Coronado island to the mainland United States. Since there are no airports or boating docks in Coronado, any firms that want to ship…
The table below shows quantity, total revenue, marginal revenue, total cost, and marginal cost for an unregulated natural monopoly firm. Calculate the price that corresponds to the profit-maximizing quantity of goods. Round your answer to two decimal places if necessary. Quantity Total Revenue Marginal Revenue Total Cost Marginal Cost 11 $105.00$⁢105.00 $105.00$⁢105.00 $100.00$⁢100.00 22 $189.00$⁢189.00 $84.00$⁢84.00 $162.00$⁢162.00 $62.00$⁢62.00 33 $247.50$⁢247.50 $58.50$⁢58.50 $220.50$⁢220.50 $58.50$⁢58.50 44 $282.00$⁢282.00 $34.50$⁢34.50 $265.00$⁢265.00 $44.50$⁢44.50 55 $300.50$⁢300.50 $18.50$⁢18.50 $305.00$⁢305.00 $40.00$⁢40.00 66 $300.00$⁢300.00 −$0.50−$⁢0.50 $339.00$⁢339.00 $34.00$⁢34.00
Which of the following describes a monopolized market structure? a. a few firms with some control over price producing similar products that are close substitutes b. a few firms with no control over price producing highly differentiated products c. many firms with no control over price producing identical products with no differentiation d. a single firm producing a highly differentiated product and serving the entire market e. a market structure with a single buyer
There is an unregulated firm with a natural monopoly. The table below shows quantity of goods to be produced, price, total revenue, total cost, marginal revenue, marginal cost, and average cost. Quantity Price Total Revenue Marginal Revenue Total Cost Marginal Cost Average Cost 11 $18.00$⁢18.00 $18.00$⁢18.00 $18.00$⁢18.00 $17.00$⁢17.00 $17.00$⁢17.00 22 $17.00$⁢17.00 $34.00$⁢34.00 $16.00$⁢16.00 $33.00$⁢33.00 $16.00$⁢16.00 $16.50$⁢16.50 33 $15.00$⁢15.00 $45.00$⁢45.00 $11.00$⁢11.00 $45.00$⁢45.00 $12.00$⁢12.00 $15.00$⁢15.00 44 $12.00$⁢12.00 $48.00$⁢48.00 $3.00$⁢3.00 $55.00$⁢55.00 $10.00$⁢10.00 $13.75$⁢13.75 55 $10.00$⁢10.00 $50.00$⁢50.00 $2.00$⁢2.00 $63.00$⁢63.00 $8.00$⁢8.00 $12.60$⁢12.60 66 $8.00$⁢8.00 $48.00$⁢48.00 −$2.00−$⁢2.00 $70.20$⁢70.20 $7.20$⁢7.20 $11.70$⁢11.70 77 $6.50$⁢6.50 $45.50$⁢45.50 −$2.50−$⁢2.50 $77.00$⁢77.00 $6.80$⁢6.80 $11.00$⁢11.00 88 $5.00$⁢5.00 $40.00$⁢40.00 −$5.50−$⁢5.50 $84.80$⁢84.80 $7.80$⁢7.80 $10.60$⁢10.60 Determine how many goods the…
4. Imagine a market with demand P = 420 – Q in each period. Two firms are thinking about colluding. They each have cost C(Qi) = 60Qi. If they cooperate and behave as a monopoly, then they have a marginal revenue curve, MRm = 420 – 2Q, and a marginal cost curve, MCm = 60. If they are in a cartel, then the firms will split the monopoly production and profits. If they compete, then they face MRi = 420 – 2Qi – Q-I and MCi = 60. a. If the firms stick to their agreement (cooperate), how much per-period profit do they each make? b. If they are not able to maintain their agreement (compete), what is their per-period profit? c. If one firm cheats on their agreement (deviate), how much does each firm make? Be sure to specify both the profit for the cheater and the firm cheated-on. d. Suppose the firms assume that their interaction will last forever (r = 1) and they share the common discount value R. What is the lowest value of R such that both firms are willing to continue with the cartel…
Breakdown of a cartel agreement Consider a town in which only two residents, Sean and Yvette, own wells that produce water safe for drinking. Sean and Yvette can pump and sell as much water as they want at no cost. For them, total revenue equals profit. The following table shows the town's demand schedule for water. Price Quantity Demanded Total Revenue (Dollars per gallon) (Gallons of water) (Dollars) 5.40 0 0 4.95 40 $198.00 4.50 80 $360.00 4.05 120 $486.00 3.60 160 $576.00 3.15 200 $630.00 2.70 240 $648.00 2.25 280 $630.00 1.80 320 $576.00 1.35 360 $486.00 0.90 400 $360.00 0.45 440 $198.00 0 480 0 Suppose Sean and Yvette form a cartel and behave as a monopolist. The profit-maximizing price is $ __________ per gallon, and the total output is __________ gallons. As part of their cartel agreement, Sean and Yvette agree to split production equally. Therefore, Sean's profit is $ __________ , and Yvette's profit is __________ .…
ne Semester 2023 dules nouncements NWP Assessment Play X signments scussions yllabus Grades Zoom People Turnitin https://calstatela.instructure.com/courses/85933/quizzes/382812/take Oligopoly Oaksville has two tennis instructors, Sam and Jack. The figure shows the demand curve and marginal revenue for tennis lesson appointments and the average total cost. Price and cost (dollars per appointment) Microsoft Office 365 Google Apps Type here to search X F1 @ 2 21 A- F2 A+ F3 Quiz: Homework 7 #3 X F4 BI $ 4 70 60 50 40 30 23 10 ☀ - F5 0 X % 5 2 Alt Text: pink glitter ro X Alt Text: appointments Competitive Outcome, (Pcomp, Qcomp) ☀+ F6 6 MR 8 F7 6 4 10 Quantity (appointments per hour) L yu F8 8 & 7 O MC D ATC F9 Negative Manuscript X * 00 8 F10 ( 9 n F11 ) 0 Oracle Peopl 59°F Mostly clouc ☆ A to F12 Hom
AP CollegeBoard Test Booklet Unit 4 Problem Set Assume that BetterCook’s patent expires. Scheff, a company with the capability to produce the same kitchen appliance as BetterCook, intends to enter the market and charge a lower price than BetterCook for the kitchen appliance. BetterCook is considering whether to maintain its price or to lower its price to match Scheff's price. Scheff is considering whether to advertise its entry into the market. The matrix below shows the payoffs for each combination of strategies, and both players (BetterCook and Scheff) have complete information. The first entry in each cell represents BetterCook’s payoff and the second entry represents Scheff's payoff. Each player independently and simultaneously chooses its strategy. Use the matrix provided below to answer parts (f)-(h). Scheff Advertise Not Advertise Maintain Price $400, $150 $600, $250 BetterCook Lower Price $300, $650 $200, $450 (f) Does Scheff have a dominant strategy? Explain using numbers from…
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Merger of beer giants faces obstacles Mega-brand beers have lost market share to wine and craft beer. In response, Anheuser-Busch InBev and SABMiller, the two biggest brewers in the world, are discussing a merger that would be scrutinized by antitrust regulators. Source: The New York Times, September 16, 2015 How would a merger benefit the two big brewers? Under what circumstances would the Federal Trade Commission (FTC) challenge the merger? A merger would benefit the two big brewers because O A. the price of beer would fall close to the price in a perfectly competitive market and sales would increase O B. average total cost would increase but price would increase by more than average total cost O C. the price of beer could rise close to the monopoly price and economic profit would increase O D. many craft brewers would be forced out of the market The Federal Trade Commission would challenge the merger if O A. it increases the HHI O B. the HHI is less than 1,500 O C. the HHI is…
4. Profit maximization and loss minimization Lagatt Green is a monopoly beer producer and distributor operating in the hypothetical economy of Lightington. Assume that Lagatt Green is not able price discriminate, and so it sells its beer to all customers at the same price per bottle. The following graph gives the marginal cost (MC), marginal revenue (MR), average total cost (ATC), and demand (D) curves that Lagatt Green faces for beer in Lightington. Place the black point (plus symbol) on the graph to indicate the profit-maximizing price and quantity for Lagatt Green. If Lagatt Green is making a profit, use the green rectangle (triangle symbols) to shade in the area representing its profit. On the other hand, if Lagatt Green is suffering a loss, use the purple rectangle (diamond symbols) to shade in the area representing its loss. PRICE (Dollars per bottle) 4.00 3.50 1.00 2:50 2.00 1.50 1.00 MC ATC MR 0 0 as 10 15 20 26 QUANTITY (Thousands of bottles of beer) D Price (Dollars per…
There is an unregulated firm with a natural monopoly. The table below shows quantity of goods to be produced, price, total revenue, total cost, marginal revenue, marginal cost, and average cost. Quantity Price Total Revenue Marginal Revenue Total Cost Marginal Cost Average Cost 11 $15.00$⁢15.00 $15.00$⁢15.00 $15.00$⁢15.00 $14.00$⁢14.00 $14.00$⁢14.00 22 $14.00$⁢14.00 $28.00$⁢28.00 $13.00$⁢13.00 $26.00$⁢26.00 $12.00$⁢12.00 $13.00$⁢13.00 33 $13.00$⁢13.00 $39.00$⁢39.00 $11.00$⁢11.00 $36.00$⁢36.00 $10.00$⁢10.00 $12.00$⁢12.00 44 $12.00$⁢12.00 $48.00$⁢48.00 $9.00$⁢9.00 $44.00$⁢44.00 $8.00$⁢8.00 $11.00$⁢11.00 55 $10.20$⁢10.20 $51.00$⁢51.00 $3.00$⁢3.00 $47.00$⁢47.00 $3.00$⁢3.00 $9.40$⁢9.40 66 $8.90$⁢8.90 $53.40$⁢53.40 $2.40$⁢2.40 $51.00$⁢51.00 $4.00$⁢4.00 $8.50$⁢8.50 77 $7.00$⁢7.00 $49.00$⁢49.00 −$4.40−$⁢4.40 $56.00$⁢56.00 $5.00$⁢5.00 $8.00$⁢8.00 88 $5.40$⁢5.40 $43.20$⁢43.20 −$5.80−$⁢5.80 $62.00$⁢62.00 $6.00$⁢6.00 $7.75$⁢7.75 Determine how many goods the firm will…