MICROECONOMICS-ACCESS CARD <CUSTOM>
11th Edition
ISBN: 9781266285097
Author: Colander
Publisher: MCG CUSTOM
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Chapter 15.1, Problem 7Q
To determine
Describe the contestable with the Herfindahl index 1,500.
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P 14 13 12 11 10 9 8 7 6 5
QD 50 100 150 200 250 300 350 400 450 500
Consider a market with the above demand and two firms. Both firms have a constant marginal cost of 7.
1. What price should these firms charge to maximize total industry profit? (Note: the marginal condition we learned will work here but you need to be careful because the changes in quantity on the schedule are not 1. Because of this, you might want to use a brute force approach here. It's worth thinking about how you would reconcile it with the marginal condition though. Also, the marginal condition doesn't match exactly so take the best number from the schedule.)
2. Assuming that if they set the same price, they split the market evenly, what will the profit of each firm be if they both set the above…
How do we measure a Herfindahl-Hirshman Index? What does a low measure mean about the extent of competition?
Chapter 15 Solutions
MICROECONOMICS-ACCESS CARD <CUSTOM>
Ch. 15.1 - Prob. 1QCh. 15.1 - Prob. 2QCh. 15.1 - Prob. 3QCh. 15.1 - Prob. 4QCh. 15.1 - Prob. 5QCh. 15.1 - Prob. 6QCh. 15.1 - Prob. 7QCh. 15.1 - Prob. 8QCh. 15.1 - Prob. 9QCh. 15.1 - Prob. 10Q
Ch. 15 - Prob. 1QECh. 15 - Prob. 2QECh. 15 - Prob. 3QECh. 15 - Prob. 4QECh. 15 - Prob. 5QECh. 15 - Prob. 6QECh. 15 - Prob. 7QECh. 15 - Prob. 8QECh. 15 - Prob. 9QECh. 15 - Prob. 10QECh. 15 - Prob. 11QECh. 15 - Prob. 12QECh. 15 - Prob. 13QECh. 15 - Prob. 14QECh. 15 - Prob. 15QECh. 15 - Prob. 16QECh. 15 - Prob. 17QECh. 15 - Prob. 18QECh. 15 - Prob. 1QAPCh. 15 - Prob. 2QAPCh. 15 - Prob. 3QAPCh. 15 - Prob. 4QAPCh. 15 - Prob. 5QAPCh. 15 - Prob. 1IPCh. 15 - Prob. 2IPCh. 15 - Prob. 3IPCh. 15 - Prob. 4IPCh. 15 - Prob. 5IPCh. 15 - Prob. 6IPCh. 15 - Prob. 7IP
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