The table below show the willingness to pay for a chicken nuggets and fries. The MC of Nuggets and Fries is zero. If Nuggets and Fries are sold separately, what is the price of each thatmaximizes profit?Chicken NuggetsFriesType I62Type II35Type III5.500Price of Nuggets = 3Price of Fries = 5Price of Nuggets = 5.50Price of Fries = 5Price of Nuggets = 3Price of Fries = 2Price of Nuggets = 5.50Price of Fries = 2

The objective of the question is to determine the price of chicken nuggets and fries that maximizes…

Answered: The table below show the willingness to…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Economics
Suppose 2 gas stations must post their prices for regular gasoline at 6am each morning and cannot change their price during the day. Each gas station has a choice: charge a relatively “low” price or charge a relatively “high” price. The following shows their profit for the day of each gas station depending upon which price each gas station chooses: Gas Station B Low Price High Price Gas Station A Low Price $2000, $900 $500, $1500 High Price $1200, $1800 $300, $2100 Assume that this is a "one shot" game: Does this game represent a prisoner’s dilemma situation? Why or why not? If the gas stations can talk the night before making their pricing decision and discuss their pricing strategies, what pricing strategy would each gas station choose the next morning? Assuming both gas stations act rationally, what will be the outcome of the game? Explain.
Ilia is driving home from work. She needs to buy gas and notices an Exxon-Mobil station on one side of the street and a Shell station on the other side of the street. Although run by different companies, the two stations sell gasoline at the same price. a. The most likely reason that the price is the same is that _gas stations always make a profit, so they can charge any price they want. _drivers need gas and are willing to pay whatever price a gas station charges. _government regulation requires both gas stations to charge the same price. _consumers view gasoline from different gas stations as perfect substitutes. b. If one station increases its price, _it will be fined by the government. _it will sell more gasoline. _it will make a higher profit. _it will lose customers to the cheaper station across the street.
Fill in blanks A-D in the following table.
Research on the following and discuss the following, present the necessary illustration: a. kinked demand curve b. Game theory c. predatory pricing d. market efficiency
Could companies implementing two pricing strategies at the same time? For instance, cost based pricing and competition based pricing
Suppose 2 gas stations must post their prices for regular gasoline at 6am each morning and cannot change their price during the day. Each gas station has a choice: charge a relatively “low” price or charge a relatively “high” price. The following shows their profit for the day of each gas station depending upon which price each gas station chooses: Gas Station B Low Price High Price Gas Station A Low Price $2000, $900 $500, $1500 High Price $1200, $1800 $300, $2100 Assume that this is a "one shot" game: 4. Does this game represent a prisoner’s dilemma situation? Why or why not? 5. If the gas stations can talk the night before making their pricing decision and discuss their pricing strategies, what pricing strategy would each gas station choose the next morning? Assuming both gas stations act rationally, what will be the outcome of the game? Explain.
Suppose 2 gas stations must post their prices for regular gasoline at 6am each morning and cannot change their price during the day. Each gas station has a choice: charge a relatively “low” price or charge a relatively “high” price. The following shows their profit for the day of each gas station depending upon which price each gas station chooses: Gas Station B Low Price High Price Gas Station A Low Price $2000, $900 $500, $1500 High Price $1200, $1800 $300, $2100 Assume that this is a "one shot" game: Which strategy should Gas Station A choose? Is it a dominant strategy? Explain why or why not. Which strategy should Gas Station B choose? Is it a dominant strategy? Explain why or why not What is the outcome for each Gas Station? How much profits will each Gas Station earn? Explain. Does this game represent a prisoner’s dilemma situation? Why or why not? If the gas stations can talk the night before making their pricing decision and discuss their pricing…
Suppose the market for quiche is perfectly competitive, so sellers take the market price as given. Hilary manages a restaurant that offers quiche for sale. The following graph plots Hilary's weekly supply curve (orange line). Point A represents a point along her supply curve. The price of quiche is $2.25 per slice, which is given by the black horizontal line. PRICE (Dollars per slice) 9.00 8.25 7.50 6.75 6.00 5.25 4.50 3.75 3.00 2.25 1.50 0.75 0 0 Price Supply 2 4 Hilary's Weekly Supply A 6 8 10 12 14 16 QUANTITY (Slices of quiche) 18 + 20 22 24 Using the previous graph, you can determine that Hilary is willing to supply her 6th weekly slice of quiche for $ per slice, the producer surplus earned from supplying the 6th slice of quiche is $ Suppose the price of quiche were to rise to $3.00 per slice. At this higher price, Hilary would receive a producer surplus of $ slice of quiche she sells. Since she receives $2.25 from the 6th

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