cesThe inverse demand for a homogeneous-product Stackelberg duopoly is P= 10,000 -4Q. The cost structures for the leader and thefollower, respectively, are CL(Q)-2,000QL and CF (QA)=4,000QFa. What is the follower's reaction function?QF=7500.5 QLb. Determine the equilibrium output level for both the leader and the follower.Leader output:Follower output:c. Determine the equilibrium market price.$d. Determine the profits of the leader and the follower.Leader profits: $Follower profits: $

Answered: Image /qna-images/answer/f5eb742e-f00c-4508-88c7-c2f2c8b8574c.jpg

Answered: ces The inverse demand for a…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Consider the following duopoly model and determine profit - maximizing output and price for q_1+ q 2 TC_1 = 10 q_(1) TC_2 = 10 q_2 each firm. P = 200 - Q Industry Demand Q =
For the given cost function C(x) = 28900+ 500x + x², First, find the average cost function. Use it to find: a) The production level that will minimize the average cost X = b) The minimal average cost $
You are the principal economist at a firm that produces some output y based on the following function: y = f(x1, x2) = x ³ x ² 1. Calculate the marginal product (MP) of both inputs at some arbitrary input bundle (x₁, x₂). Interpret the sign of both. 2. Using your answer in the previous part, calculate OMPT₂/0x₁. Interpret what this means. 3. Calculate the technical rate of substitution between ₁ and x2, i.e., MP/MP₂. 4. Does this production function exhibit increasing, decreasing, or constant returns to scale? Show. 1 5. Lay out a brief, realistic example of x₁, x2, y that fits the dynamics that you calculated.
NOTE: strictly use algebraic approach. Formulas are given in the photo attached thank you
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Question 1: A homogeneous products duopoly faces a market demand function given by Q = 10 - 2P, where Q = Q1 + Q2. Both firms have a constant marginal cost MC = 2. 1. Suppose the two firms set their quantities simultaneously by guessing the other firm's quantity choice. Derive the equation of each firm's reaction curve and then graph these curves. 2. What is the Cournot equilibrium quantity and price in this market for each firm? 3. What would the equilibrium price in this market be if it were perfectly competitive? 4. What is the Bertrand equilibrium price in this market?
In a Cournot setting, what should be the produced quantity and realized price in a duopoly with firms A and B that is characterized by P=140-Q and constant marginal costs of $20?.
Use excel to compute Ps: the formula is given in the picture below
Suppose that the cost of producing X units of a product in a manufacturing company is F + VX where F = Total fixed cost and V = Variable cost per unit. The actual cost of producing X units is Co and this increases to C, when the actual number of units increases to X1. Using the high-low method which formula below represents the estimated value of the unit variable cost, V? A. (C1 – Co) / (X1 – Xo) B. (X1 - Xo) / (C1 – Co) C. (X1 Xo) / (Co-C1) D. (C1 - Co) / (Xo-X1)
2. Consider the production functions given below: a. Suppose that the production function faced by a bread producer is given by Q = 4KL, where MPK = 4L and MP, = 4K. i. Do both labor and capital display diminishing marginal products in the short run? Explain. ii. Find the marginal rate of technical substitution for this production function. (Hint: The MRTS MPL MPK iii. Does this production function display a diminishing marginal rate of technical substitution? iv. Graph isoquants for Q = 20, and Q = 40. Put capital (K) on the y-axis and labor (L) on the x- axis. Label the isoquants with their quantities. v. What are the returns to scale for this firm? Explain. 20 19 18 17 16 15 14 13 12 11 10 9 0 1 2 3 4 5 6 00 9 10 11 12 13 14 15
On the CVP graph, the next unit sold will increase total cost by an amount equal to the Select one: a. Contribution margin ratio b. Selling price per unit c. Selling price per unit minus the variable costs per unit d. Difference between contribution margin and fixed costs e. Variable costs per unit
On the CVP graph, the next unit sold will increase total cost by an amnount equal to the Select one: O a Difference between contribution margin and fixed costs b.Selling price per unit minus the variable costs per unit c Variable costs per unit d. Contribution margin ratio e Selling price per unit

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