There are two firms in a homogenous product market described by the demand function P(q1,q2)%3D131-(1/5)(q1+q2), and both firms have marginal costs of 50. Firms choose once and simultaneously quantities. How much does firm 1 produce in equilibrium?
Q: Price and Cost ($) Given the information from the figure, if price equals $0.40, the firm should ATC...
A: "A profit maximizing firm shut down when the market price for it's commodity or service is lesser th...
Q: Which of the following statements are false? (i) If a 12% decrease in an individual’s income increas...
A: (i) If a 12% decrease in an individual’s income increases his quantity demanded for oats by 6%, the ...
Q: Which of the following parameters produces the largest fluctuations in real GDP from an autonomous e...
A: The multiplier value depends on the value of MPC, Tax and marginal propensity to import.
Q: According to the liquidity preference theory, if the money supply increases, then, ceteris paribus, ...
A: This theory says that the interest rate in the market is determined by the demand and supply of mone...
Q: a=$250b, I=$500b, G= $350b, MPC=80%; Calculate: the multiplier the equilibrium level of income
A: The multiplier value depends on the value of the marginal propensity to consume. Higher the MPC, hig...
Q: For a given level of national income, a decrease in private consumption or government and the flow o...
A: The Solow Model of economic growth or the neo classical model of growth This model is also known as ...
Q: Assume both firm 1 and firm 2 are in the market and act as oligopolists. Assume furthermore that the...
A: In Bertrand competition, firms charges price of its product simultaneously.
Q: Suppose that nominal GDP was $20 trillion in 2040 in Bedrock. In 2050, nominal GDP was $18 trillion ...
A: The nominal GDP in 2040 was $20 trillion The nominal GDP in 2050 was $18 trillion ------------------...
Q: EXPLAIN PROVIDE EXAMPLE OF THE FOLLOWING FACTORS AFFECTING THE DEMAND Price of the good or service ...
A: The quantity of an item that consumers demand at various prices during a certain period of time is r...
Q: x(q) = R(a)- C(a) = 180g - (665 + 20g + 10g). What is the positive output level that maximizes the f...
A: In economics, profit maximization is the short run or long run process by which a firm may determine...
Q: This question requires three answers. What happens to each welfare component when an excise tax is i...
A: A direct tax is one that is paid directly to the institution that imposed it. Individual taxpayers, ...
Q: what assets are involved in quantitative easing?
A: Quantitative facilitating (QE) is a type of whimsical monetary policy wherein a central bank buys lo...
Q: 12,000 EUSA 5000 w,000 i- 3.6% co.yearly 15,000 ooo ,ר!
A: Given
Q: Compare the following alternatives on the basis of Present worth Analysis at an interest rate of 4% ...
A: Given information Project 1 Petroleum based feedstock Initial cost=2420000 Annual operating cost=500...
Q: One implication of an increase in the cash drain to the public is that the... a. Desired reserve rat...
A: A constraint on the expansion of the supply of money through the creation of money deposits is known...
Q: Classical economists believe that... a. The economy is composed of the real sector and the monetary ...
A: Classical economist' primary premise is that markets function effectively and provide the best macro...
Q: Consider the following demand of tourists (T) and locals (L) for spots in a race: SQ" = 1,700 – 5p l...
A:
Q: of the domestic Ceteris paribus, an increase in the domestic money supply leads to currency, thereby...
A: The total volume of money that is being held by the public at a specified point of time in an econom...
Q: Fifty years ago, the minimum wage in a hypothetical country was approximately $1.50 per hour. At tha...
A: Since colonial times, Americans have been moaning about the high cost of living. Measurement and tra...
Q: The maintenance cost of a new equipment is projected to start at the end of the 2nd year at an amoun...
A: Cost is the expenditure incurred in the production of goods and services. It is the fixed cost and v...
Q: emand for domestically produced steel to increase. one or both of the curves on the following graph ...
A: Equilibrium is achieved at the output level where Ls equals Ld
Q: Amazing Airlines has the following customer metrics: Average customer relationship length: 8 years A...
A: Customer lifetime value is the total value that a customer provides to a particular business over th...
Q: uestion Four In the market for kenkey (NORMAL GOOD), consumers’ income has decreased. In that same m...
A: When the consumer income decreases, it decreases the demand for normal good and the demand curve sh...
Q: how does public opinion impact our society and our political system? (American government 101)
A: By its actual nature, the majority rule process prods residents to shape opinions on various issues....
Q: Does Smith think these new low skill jobs created by the Industrial Revolution will be good for soci...
A: Smith believes that the Industrial Revolution's introduction of low-skilled occupations will benefit...
Q: Nominal Year CPI Real GDP GDP 1980 $2857.31 82.38 1981 $3207.04 90.93 1982 $3343.79 96.55 1983 $3634...
A: The formula required to fill the blank column is given below: Real GDP=Nominal GDP(Current Year)× CP...
Q: Define in your own words what is production and what are the factors that enhances the production in...
A: Introduction and definition if production is given below:
Q: The following graph depicts the daily labour supply curve for Jake, a worker in the construction ind...
A: Upward sloping labor supply curve for jake shows that there is a positive relationship between the w...
Q: Consider a two-period small open endowment economy with free capital mobility. Households live for o...
A: PLEASE FIND THE ANSWER BELOW.
Q: What things do people do now which they couldn't do before globalization?
A: Globalization is described as the spread of technology, products, jobs, and information across count...
Q: In April 2002, the price of a Big Mac in the UK was £1.99. Using data from The Economist's Big Mac I...
A: Developed in 1986 by The Economist magazine, the Big Mac index uses McDonald's Big Mac prices as a b...
Q: In a small open economy, how will the domestic be affected by a positive productivity shock? O. The...
A: an open economy includes all sector such as Household sector , Producers sector , Government sector ...
Q: b) Given that nothing else is borrowed in the near future, the length of time it will take a governm...
A: Government debt Government Debt is a concept that has been for a long time and will continue to exis...
Q: What is the after-tax present worth of a chip placer if it costs $75,000 and saves $23,000 per year?...
A: Let's solve it step by step:- The tax rate is 54% thus, calculating it by considering it at every po...
Q: Consider a two-period intertemporal choice model in which your endowment of income in the two period...
A:
Q: Assume that household 1 and household 2 has the following demands for education (a private good) (in...
A: Price Qd1 (Household 1) Qd2 (Household 2) Total Qd(Qd1+Qd2) 36000 60 70 130 45000 42 58 ...
Q: What are deposits and the money supply if the required reserve ratio is 50% and reserves are 5,000 w...
A: The money multiplier is inversely related to the required reserve. It means as the required reserve ...
Q: The number of users of a certain website (in millions) from 2004 through 2011 follows. Year Period U...
A: Time Series is the collection of observations of various data items obtained through various measure...
Q: What does a Rothschild Index score close to zero mean? The firm's product is very price sensitive. T...
A: The Rothschild index compares the elasticity of industrial demand for goods to the demand of a singl...
Q: In the evolution of the state of despotic....what is the mode of production
A: Despotic state refers to when the individual holds all the power. In economics, it refers to when go...
Q: solve A in this cash flow diagram
A: The cash flow is the outflow or inflow of cash into the business. It means as cash inflow into the b...
Q: Is the outcome in a monopolistically competitive market desirable from the standpoint of society? Ca...
A: A monopolistic competitive market is the one where firms provide differentiated goods which makes th...
Q: What are the advantages and disadvantages of division of labour?
A:
Q: QUESTION 28 Fl in the blank using the number that corresponds to the correct word or phrase in the w...
A: The emphasis on opportunity cost, the assumption of maximization in terms of one's own self-interest...
Q: 26,000 HEOM in 3% co.yearly 40,000
A: Introduction We have given a cash flow. Average value of 26,000 = 26,000/6 = 4,333.33 Present value ...
Q: The M2++ and M3 definitions of the money supply include financial assets... O a. Such as a credit ca...
A: The total volume of money that is being held by the public at a specified period in an economy is kn...
Q: You are shopping around to determine which bank account yields the highest return. You have three ch...
A: Future worth using compounding formula is F=A1+innt ... (1) Where i is the rate of intere...
Q: Explain two strategies a firm in an oligopoly market pursue to increase customer loyalty.
A: Companies that collaborate or work together to reduce competition and control a separate market or s...
Q: Consider a monopoly with the following marginal cost and demand curves: MC = 2Q + 200, p = 2,600 – 2...
A: For first price discrimination, the monopoly firm is able to charge prices equals to the consumers w...
Q: The advantage of using contractionary fiscal policy to address a short-run inflationary gap, rather ...
A: Contractionary fiscal policy is implemented by the government.
Step by step
Solved in 2 steps
- Suppose market inverse demand function is p(y)=100-Yt where Yt is total production in the market. Assume that there are two firms with following marginal cost MC(firm 1)=Y1 MC(firm 2)=2*Y2+10 Assume that Yt=Y1+Y2 Set up profit function for both firms. What is the best response function of each firm by taking into account action of other firm? What output level is going to be produced by each firm in equilibrium? Assume that Firm 1 is leader in the market and going to act first. What will be the best response and output level of firm 2. What is difference between previous and new situation? Why? What is difference between Bertrand and previous competition? How would you like to find equilibrium price?Suppose there are in total 3 firms in the market. Firm 1 decides its output first, then Firm 2 and Firm 3 decide their outputs simultaneously. The inverse demand function is p = 14 – 3q, where q = q1 + q2 + 43, and each firm's cost function is c(q.) = 2q?. What is the quantity that Firm 1 produces? Round your answer to 2 decimal points. Answer: The correct answer is: 1.04Suppose the Boston to Philadelphia airline route is serviced by three airlines – US Airways (Firm A) and JetBlue (Firm B) and Continental (Firm C). The demand for airline travel between these two cities is Q = 150 – p. The cost function is C(Q) = 30Q. The cost function is the same for all three airlines. Assume that the three airlines are making investments in airline capacity. In other words, they are simultaneously choosing quantity. (Cournot Competition) Derive US Airways’ residual demand function given JetBlue’s output, qB, and Continental’s output, qC. What is the Marginal Revenue for US Airways? Derive US Airways reaction function Derive the market equilibrium quantity, Q*, price, p*, and Profit.
- Discuss economies of scale and how average cost changes as output increases. What pricing strategy should a firm adopt while they are experiencing economies of scale? 250 words pleaseSuppose that the profit from the sale of Kisses and Kreams is given by the following, where x is the number of pounds of Kisses and y is the number of pounds of Kreams. P(x, y) = 10x + 6.6y - 0.001x² -0.025y² dollars You know from previous experience that, for such a profit function, profit will be maximized at the critical point of P(x,y). (a) Determine the amounts of Kisses and Kreams that will maximize profit. pounds of Kisses pounds of Kreams (b) What is the maximum profit? (Round your answer to two decimal places.) $Assume that there are two firms in the market described by the inverse demand function P(q1,q2)=186 - (2/2)(q1+q2). Firm 1 has marginal costs of 51 and decides on first. Firm 2 has marginal costs of 62 and moves second. Both firms decide on quanties once. How much does firm 1 produce in equilibrium? (answer to 2 decimal places)
- Here is a market with three firms: 1, 2, and 3. The demand curve is P=100-Q. There is no fixed cost but the marginal cost 10 for all firms. Firm 1 is a leader firm so that it decides the quantity Q1 first. Then two firms respectively decide their quantities Q2 and Q3 simultaneously. 1) At an equilibrium (SPE), Q1 is Q2=Q3= 2) At the equilibrium, (the market quantity) Q= and (the market price) P= 3) The profit of firm 1 is while the profit of firm 2 and 3 respectively isSuppose that the market demand for a product is given by Q= A-P (A> 0). Suppose also that in a competitive industry the typical firm's cost function is given by C(g) = a- (а > 0). 2 (a) Calculate the long-run equilibrium market price P and the output for the typical firm q. (b) Calculate the equilibrium number of firms in the market. (c) Derive, and determine the sign of, dn/dA and dn/da. Explain the signs intuitively.The two side by side graphs are for two firms that between them supply all the original grown advocados for a local area. With vigorous competition between the firms, the price per pound has settled at a point where both firms are just breaking even. For each firm, the marginal cost (mc) average variable cost (avc) and average total (atc) curves are shown In the blank graph below, use the straight line tool to draw a straight line representing the short run market supply curve for quantities above zero. (that is Dont worry about operating points for which the quantity is zero)
- consider a market with inverse demand P(Q) = 10 − Q and two firms with cost curves C1(q1) = 2q1 and C2(q2) = 2q2 (that is, they have the same marginal costs and no fixed costs). They compete by choosing quantities. Suppose that Firm 1 chooses quantity first and is able to credibly commit to this choice. Then firm 2 choose its quantity after observing firm 1’s quantity. In the SPNE of this game, what is the price faced by consumers?- p = 3- p = 4- p = 5- p = 6- p = 7There are only two driveway paving companies in a small town, Asphalt, Inc. and Blacktop Bros. The inverse demand curve for paving services is ?= 2040 ―20? where quantity is measured in pave jobs per month and price is measured in dollars per job. Assume Asphalt, Inc. has a marginal cost of $100 per driveway and Blacktop Bros. has a marginal cost of $150. Answer the following questions: Determine each firm’s reaction curve and graph it. How many paving jobs will each firm produce in Cournot equilibrium? What will the market price of a pave job be? How much profit does each firm earn?Q1: Analytical part - 8% Best Orange Juice Company is located in Oman. The cost function for total orange juice production (x) is given by C(q) = 0.25x2. Their orange juice is demanded only in Muscat (Muscat demand is Xm- 100-2Pm) and Salalah (Salalah demand is X 100-4Ps). Therefore, the total demand is x-xm+ Xs. If the company can control the quantities supplied to each market, how many should it sell in each location to maximize total profits? What price would it charge in each location? Answer: