Suppose you work for Philippine Competition Commission and you find out that in province A, t only two available hospitals are planning to merge, which would result to a monopoly. If you do n allow for merging, hospital 2 will leave the market. Given the following cost functions and t information provided, would you allow for the merging of the two hospitals? Why or why not? Expla intuitively and mathematically. Hospital 1's cost function = 30 + q Hospital 2's cost function = 40 + 92 Joint cost function = 50+q+q2

Suppose you work for Philippine Competition Commission and you find out that in province A, t only two available hospitals are planning to merge, which would result to a monopoly. If you do n allow for merging, hospital 2 will leave the market. Given the following cost functions and t information provided, would you allow for the merging of the two hospitals? Why or why not? Expla intuitively and mathematically. Hospital 1's cost function = 30 + q Hospital 2's cost function = 40 + 92 Joint cost function = 50+q+q2

EBK HEALTH ECONOMICS AND POLICY

7th Edition

ISBN:9781337668279

Author:Henderson

Publisher:Henderson

Chapter10: The Hospital Services Market

Section: Chapter Questions

Problem 6QAP

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