QUESTION 10 TRUE or FALSE: In the equilibrium of Hotelling's main street model with variable prices and locations, firms locate in the center of the street, right next to each other, just as in the beach model. O TRUE ⒸFALSE QUESTION 11 In Hotelling's main street model, consumers faced a transportation cost of t. If you were one of the firms in that model, would you prefer t to be low or high? Why? OA High. Greater transportation cost means I don't have to compete as aggressively for business, so I make more money. OB-Low. Lower transportation cost means consumers are better off, and I only want to maximize consumer welfare. ● C-Low. Lower transportation cost means I don't have to compete as aggressively for business, so I make more money. OD. High. Greater transportation cost means consumers are more willing to buy products, so I make more money.

QUESTION 10 TRUE or FALSE: In the equilibrium of Hotelling's main street model with variable prices and locations, firms locate in the center of the street, right next to each other, just as in the beach model. O TRUE ⒸFALSE QUESTION 11 In Hotelling's main street model, consumers faced a transportation cost of t. If you were one of the firms in that model, would you prefer t to be low or high? Why? OA High. Greater transportation cost means I don't have to compete as aggressively for business, so I make more money. OB-Low. Lower transportation cost means consumers are better off, and I only want to maximize consumer welfare. ● C-Low. Lower transportation cost means I don't have to compete as aggressively for business, so I make more money. OD. High. Greater transportation cost means consumers are more willing to buy products, so I make more money.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter10: Prices, Output, And Strategy: Pure And Monopolistic Competition

Section: Chapter Questions

Problem 2.2CE

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