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3*. Consumers are distributed uniformly along an avenue with one kilometer length. Retailer A is located on the left end, whereas retailer B is located on the right end. Both retailers sell an homogeneous good, and consumers buy one unit at most. If consumers move to the left their transportation cost is C(d) = d, but it is C(d) = dd, with 8 > 0 when they move to the right. Assume firms have no cost at all. (a) If 8 < 1, all consumers buy at retailer B. X(b)If both retailers set the same price, as & increases, the indifferent consumer is closer to retailer B. (c)If both retailers set the same price, the indifferent consumer is just in the middle. (d) All the other answers are incorrect.

3*. Consumers are distributed uniformly along an avenue with one kilometer length. Retailer A is located on the left end, whereas retailer B is located on the right end. Both retailers sell an homogeneous good, and consumers buy one unit at most. If consumers move to the left their transportation cost is C(d) = d, but it is C(d) = dd, with 8 > 0 when they move to the right. Assume firms have no cost at all. (a) If 8 < 1, all consumers buy at retailer B. X(b)If both retailers set the same price, as & increases, the indifferent consumer is closer to retailer B. (c)If both retailers set the same price, the indifferent consumer is just in the middle. (d) All the other answers are incorrect.

MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
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3*. Consumers are distributed uniformly along an avenue with one kilometer length. Retailer A is located on the left end, whereas retailer B is located on the right end. Both retailers sell an homogeneous good, and consumers buy one unit at most. If consumers move to the left their transportation cost is C(d) = d, but it is C(d) = dd, with 8 > 0 when they move to the right. Assume firms have no cost at all. (a) If 8 < 1, all consumers buy at retailer B. X(b)If both retailers set the same price, as 8 increases, the indifferent consumer is closer to retailer B. (c)If both retailers set the same price, the indifferent consumer is just in the middle. (d) All the other answers are incorrect.
Transcribed Image Text:3*. Consumers are distributed uniformly along an avenue with one kilometer length. Retailer A is located on the left end, whereas retailer B is located on the right end. Both retailers sell an homogeneous good, and consumers buy one unit at most. If consumers move to the left their transportation cost is C(d) = d, but it is C(d) = dd, with 8 > 0 when they move to the right. Assume firms have no cost at all. (a) If 8 < 1, all consumers buy at retailer B. X(b)If both retailers set the same price, as 8 increases, the indifferent consumer is closer to retailer B. (c)If both retailers set the same price, the indifferent consumer is just in the middle. (d) All the other answers are incorrect.
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