Find the answers to questions Answer:equilibrium uniform price of firm A =profit of firm A under uniform pricing=equilibrium price of firm A on interval 1equilibrium price of firm B on interval 1 19:58 Thu 12 Decmoodle4.city.ac.uk74%Consider a standard Hotelling model of competition with quadratic transportationcosts. The consumers are located uniformly along a segment of unit length. Thereare two firms, A and B, located at the opposite ends of the segment. Each firm hasconstant marginal costs 0. Each consumer buys at most one unit of product andgets utility 16. Each consumer incurs travel cost of 5 times the square of traveleddistance.Find equilibrium price and profit of firm A when firms set a unform price for theentire Hotelling segment.Suppose now that firms can price discriminate between consumers located in theinterval [0,1] (interval 1) and those located in the interval [4.1] (interval 2). Find4equilibrium prices of firm A and B on the interval 1.Answer:

Step 1:Equilibrium price is the price at which the quantity of a good or service demanded by…

Answered: Answer: equilibrium uniform price of…

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter17: Oligopoly

Section: Chapter Questions

Problem 9PA

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Ajax Cleaning Products is a medium-sized firm operating in an industry dominated by one large firmâ€”Tile King. Ajax produces a multiheaded tunnel wall scrubber that is similar to a model produced by Tile King. Ajax decides to charge the same price as Tile King to avoid the possibility of a price war. The pnce charged by Tile King is $20,000. Ajax has the following short-run cost curve: TC=800,0005,000Q+100Q2 Compute the marginal cost curve for Ajax. Given Ajaxs pricing strategy, what is the marginal venue function for Ajax? Compute the profit-maximizing level of output for Ajax. Compute Ajaxs total dollar profits.
Aside from advertising, how can monopolistically competitive films increase demand for their products?
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When OPEC raised the price of oil dramatically in the mid-1970s, experts said it was unlikely that the cartel could stay together over the long term-that the incentives for individual members. to cheat would become too strong. More than fort),r years later, OPEC still exists. Why do you think OPEC has been able to beat the odds and continue to collude? Hint: You may wish to consider non-economic reasons.
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Some years ago. two intercity bus companies, Greyhound Lines, Inc. and Trailways Transportation System, wanted to merge. One possible definition of the market for this case was the market for intercity bus service. Another possible definition was the market for intercity transportation, including personal cars, car rentals, passenger trains, and commuter air flights.' Which definition do you think the bus companies preferred, and why?
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Suppose the market for Hula Hoops is monopolized by a single firm. a. Draw the initial equilibrium for such a market. b. Now suppose the demand for Hula Hoops shifts outward slightly. Show that, in general (contrary to the competitive case), it will not be possible to predict the effect of this shift in demand on the market price of Hula Hoops. c. Consider three possible ways in which the price elasticity of demand might change as the demand curve shifts: It might increase, it might decrease, or it might stay the same. Consider also that marginal costs for the monopolist might be increasing, decreasing, or constant in the range where MR=MC Consequently, there are nine different combinations of types of demand shifts and marginal cost slope configurations. Analyze each of these to determine for which it is possible to make a definite prediction about the effect of the shift in demand on the price of Hula Hoops.

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