(Dominant Firm with Fringe Competition) The structure of competition in the market for product A follows the dominant firm model with competitive fringes, where there is one company that is a dominant player and there are many fringes companies that compete competitively. The total demand for product A in this market is expressed by P = 1200 - Q, while the supply function of the competitive fringe is expressed by Sf: qf = P - 240. If the dominant firm is known to have marginal costs as follows: MCd = 240 + 0.25qd b. What is the equilibrium price and the equilibrium quantity for the dominant firm? Show your answer mathematically and graphically. c. In that equilibrium, what is the supply of competitive fringes? How many total products are there on the market? What is the market share of the dominant company and the fringe company? Show your answer mathematically and graphically
(Dominant Firm with Fringe Competition)
The structure of competition in the market for product A follows the dominant firm model with competitive fringes, where there is one company that is a dominant player and there are many fringes companies that compete competitively.
The total demand for product A in this market is expressed by P = 1200 - Q, while the supply function of the competitive fringe is expressed by Sf: qf = P - 240.
If the dominant firm is known to have marginal costs as follows: MCd = 240 + 0.25qd
b. What is the
c. In that equilibrium, what is the supply of competitive fringes? How many total products are there on the market? What is the market share of the dominant company and the fringe company? Show your answer mathematically and graphically
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