Assume that the market demand for a new drink is given by P = 30 – Q and the marginal cost to produce this new drink is $3 Calculate the Cournot market equilibrium price-output solutions and the Stackelberg market equilibrium price-output solutions for the same.
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Assume that the market demand for a new drink is given by P = 30 – Q and the marginal cost to produce this new drink is $3
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- Stutz Department Store will buy 10 pairs of sunglasses if the price is $76 per pair and 30 pairs if the price is $26. The supplier of the sunglasses is willing to provide 35 pairs if the price is $81 per pair but only 5 pairs if the price is $21. Assuming that the supply and demand functions for the sunglasses are linear, find the market equilibrium point. Suppose that in a certain market the demand function for a product is given by 10p + q = 2,100 and the supply function is given by 50p − q = 1,350. (Assume price is measured in dollars.) If the government levies a tax of $3 per item, find the equilibrium point after the tax is levied. The tax is added to the selling price of the product.Assume the inverse demand function in a market is given by P(Q) = 500 - Q where Q is the total industry output, that is the sum of the output of all firms in the market. There are two firms (indexed by i = 1,2) who both have a cost of producing the good given by c(qi) = 10 * qi The two firms are competing in the Cournot manner, that is they choose their quantities simultaneously in order to maximize profits.Back in 2016, there were two main streaming services Netflix and Hulu. The market inverse demand for streaming is P = 20 – Qh-Qn Marginal cost for both streaming services is 2. Find the reaction functions and equilibrium strategies and equilibrium price/quantity from this market. Show your work and clearly mark your answers.
- Jack is the owner of the only local bar in a small town.He sells whiskey in one-ounce glasses. For simplicity, let’s assume it doesn’t cost Jack anything to run his business. There are two customers, Adam and Burt who are twin brothers. Adam’s demand function is yA = 16 – 2p, and Burt’s demand function is yB = 8 – p (price is measured in dollars and quantity is measured by ounces). Jack knows their demand functions, but the problem is that he cannot tell them apart since they look exactly the same to him. To increase his profits, Jack offers the following two options that his customers can choose from: (1) You can pay $T1 up front and drink as much as you want; or (2) Pay $T2 up front and the price per ounce of whiskey will be $p. 1.a If p = 4, what is the maximal T2 that Jack can charge so that Burt is willing to come to the bar? 1.b What is the maximal T1 that Jack can charge so that Adam will choose the first pricing option?Jack is the owner of the only local bar in a small town.He sells whiskey in one-ounce glasses. For simplicity, let’s assume it doesn’t cost Jack anything to run his business. There are two customers, Adam and Burt who are twin brothers. Adam’s demand function is yA = 16 – 2p, and Burt’s demand function is yB = 8 – p (price is measured in dollars and quantity is measured by ounces). Jack knows their demand functions, but the problem is that he cannot tell them apart since they look exactly the same to him. To increase his profits, Jack offers the following two options that his customers can choose from: (1) You can pay $T1 up front and drink as much as you want; or (2) Pay $T2 up front and the price per ounce of whiskey will be $p. 1.a If p = 4, what is the maximal T2 that Jack can charge so that Burt is willing to come to the bar? 1.b What is the maximal T1 that Jack can charge so that Adam will choose the first pricing option? Answer Key that was given. I seems not to understand…Assume Tea brands ChotooChai and BaraChai are competing brands in the market. With arrival of winter season, ChotooChai announces good promotional deals. Using ‘Comparative Statics Analysis’ of demand and supply model: How will the managements of the two brands study the short-run and long-run impact on Tea Sales, after the announcement of promotions in the market of Tea? Demonstrate and explain, with clearly labelled two panel diagrams, the ‘Rationing Function’ and the Allocating or ‘Guiding Function’ of Price.
- Suppose that managers at Honda are deciding how to price the new Honda Accord. The managers estimate that their total costs increase by $20,000 for each car they produce. They also estimate the demand curve they face; it is described by the equation: Q = -0.4 P + 16,000, where Q represents the quantity of Honda Accords they will sell and P represents the price they charge in US dollars. We can re-write that demand curve as: P = 40,000 - 2.5 Q. Take every possibly quantity that the managers might choose between and 7,000 in units of 100. For each possible quantity, calculate the associated price the managers would need to charge, the revenue they would earn, and the total costs. You can then calculate profits for each level of quantity. Highlight the cell that contains the highest value of profit. Finally, you can also approximate marginal revenue here as the change in total revenue after the next 100 cars are produced. At what quantity does marginal revenue roughly equal marginal cost?…Suppose that managers at Honda are deciding how to price the new Honda Accord. The managers estimate that their total costs increase by $20,000 for each car they produce. They also estimate the demand curve they face; it is described by the equation: Q = -0.4 P + 16,000, where Q represents the quantity of Honda Accords they will sell and P represents the price they charge in US dollars. We can re-write that demand curve as: P = 40,000 - 2.5 Q. Take every possibly quantity that the managers might choose between 0 and 7,000 in units of 100. For each possible quantity, calculate the associated price the managers would need to charge, the revenue they would earn, and the total costs. You can then calculate profits for each level of quantity. Highlight the cell that contains the highest value of profit.The daily demand of two firms Firm 1 and Firm 2 producing two products is given by : D1 = 5 - 22P1 + 11P2 D2 = 50 - 22P1 + 11P2 These are the only firms producing the products. MC of Firm 1 is $0.5 per product and MC of Firm 2 is $2 per product. Q1. Calculate the equilibrium quantity and price of both the firms. You may assume that firms want to maximise the profits. Q2.Calculate producer surplus and deadweight loss.
- 2. Jack is the owner of the only local bar in a small town. He sells whiskey in one-ounce glasses. For simplicity, let's assume it doesn't cost Jack anything to run his business. There are two customers, Adam and Burt who are twin brothers. Adam's demand function is ya = 16 – 2p, and Burt's demand function is yg = 8- p (price is measured in dollars and quantity is measured %3D by ounces). Jack knows their demand functions, but the problem is that he cannot tell them apart since they look exactly the same to him. To increase his profits, Jack offers the following two options that his customers can choose from: (1) You can pay $T1 up front and drink as much as you want; or (2) Pay $T2 up front and the price per ounce of whiskey will be $p. 2.a If p = 4, what is the maximal T2 that Jack can charge so that Burt is willing to come to the bar? 2.b What is the maximal T, that Jack can charge so that Adam will choose the first pricing option?There are two soda firms Apple and Dell in Cournot completion . The market inverse demand is P = 32 – Q1-Q2 Marginal cost for both firms is 8. Find the reaction functions and equilibrium strategies and equilibrium price/quantity from this market. Show your work and clearly mark your answers. Request: Please provide graph if applicable. Please provide a typed answer. Your help is much appreciated!A manufacturing business can supply 60 plasma TV sets per month at a price of $280 per set, or sell 140 plasma TV sets if the price is $370 per set. A group of retailers will buy 80 plasma TV’s if the price is $350 per pair and 120 plasma TV’s if the price is $300 per set. Given that the demand and supply functions must be linear: Find the linear equations representing both demand and supply Find the point of market equilibrium (number of TVs: q) and the price per unit (p) at that point.
