1&2 please Nash Equilibrium, Oligopolies & MonopoliesPricePricePriceLowMediumHighPrice Low12, 1215, 822, 4Price8, 1513, 1316, 10MediumPrice High4, 2210, 1614, 14Pepsi = Player at left#'s represent profits in millionsCoke = Player at right1) In the grid above, Pepsi is the player at the left and Coke is the player at the top.These two companies compete in an oligopoly (Market structure with very few producersin the market). What pricing strategy do you think Pepsi and Coke would use? Explainwhy.2)Based on the grid above, why would Pepsi and Coke never settle at (Price High,Price High)? (Hint: How could they cheat each other in that situation?)If Coke went out of business and we only had Pepsi, how might the price of Pepsi3)change? (Hint: Pepsi would probably be considered a monopoly.) Explain why.4)Based on what we have discussed in class, and based on the answers above,what kind of market is better for the consumers? A monopoly or an oligopoly? Explainyour answer.

An oligopoly defines a market structure where a few major firms dominate a substantial portion of…

Price Low Price Medium Price High Nash Equilibrium, Oligopolies & Monopolies Price Low 12, 12 8, 15 4,22 Price Medium 15,8 13, 13 10, 16 Price High 22,4 16, 10 14, 14 Pepsi = Player at left Coke Player at right 1) In the grid above, Pepsi is the player at the left and Coke is the player at the top. These two companies compete in an oligopoly (Market structure with very few producers in the market). What pricing strategy do you think Pepsi and Coke would use? Explain why. #'s represent profits in millions 2) Based on the grid above, why would Pepsi and Coke never settle at (Price High, Price High)? (Hint: How could they cheat each other in that situation?)

Price Low Price Medium Price High Nash Equilibrium, Oligopolies & Monopolies Price Low 12, 12 8, 15 4,22 Price Medium 15,8 13, 13 10, 16 Price High 22,4 16, 10 14, 14 Pepsi = Player at left Coke Player at right 1) In the grid above, Pepsi is the player at the left and Coke is the player at the top. These two companies compete in an oligopoly (Market structure with very few producers in the market). What pricing strategy do you think Pepsi and Coke would use? Explain why. #'s represent profits in millions 2) Based on the grid above, why would Pepsi and Coke never settle at (Price High, Price High)? (Hint: How could they cheat each other in that situation?)

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter17: Oligopoly

Section: Chapter Questions

Problem 9PA

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II. Answer the following T/F questions a. b. C. d. e. Tor F, an oligopolist, like the monopolist, earns LR economic profits. Tor F, retail clothing stores are classified as an oligopoly market structure. T or F, the monopolistic competitor and the oligopolist do not engage in non-price competitive strategies. T or F, the oligopolist reaches both productive and allocative efficiency in the long run. T or F, a monopolistic competitor sells a differentiated product giving them the ability to have some price control.
2. The market for dark chocolate us characterized by Cournot duopolists - Honeydukes and Wonka industries. The market demand for dark chocolate is:P = 8 - 0.005Qdwhere P is the price per bar in dollars and Qd is dark chocolate's daily quantity demanded in bars (use qh to represent the quantity of dark chocolate sold by Honeydukes and qw to represent the quantity of dark chocolate sold by Wonka Industries). Honeydukes has a constant marginal cost of $2.50 per bar, while Wonka Industries has a constant marginal cost of $3.00 per bar. The firms move simultaneously in choosing their profit-maximizing quantity of output.a. Given the firms move simultaneously, what is the equation for Honeydukes' reaction function with qh expressed as a function of qw?b. Given the firms move simultaneously, what is the equation for Wonka's reaction function with qw expressed as a function of qh?c. What quantity of dark chocolate will each firm produce in equilibrium and what price will be established for a…
3) Bookface, the largest online social media network in the world, is being sued for abusing market power and attempting to create a monopoly. To defend his company, its founder Zark Muckerberg claims that in the social media industry, users want to be on whichever platform their friends are, which makes the creation of monopolies inevitable. Prosecutors, however, disagree. They claim that Bookface has used its market power to drive small companies out of the market. a. Which side is right? b. Please discuss this phenomenon and its sources.
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Suppose the carwash market is monopolistically competitive and that businesses in this market are currently earning positive economic profits. In the long run, the demand for an individual car wash business will the market , which will cause economic profits to as more carwash businesses enter Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a fall; rise fall; fall to zero rise; fall to zero d rise; rise
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ls uccess Tips ■ccess Tips NOUT Actumpto Koup the Highest/3 3. Is monopolistic competition efficient? Suppose that a firm produces baseball bats in a monopolistically competitive market. The following graph shows its demand curve, marginal revenue (MR) curve, marginal cost (MC) curve, and average total cost (ATC) curve. Place a black point (plus symbol) on the graph to indicate the long-run monopolistically competitive equilibrium price and quantity for this firm. Next, place a grey point (star symbol) to indicate the minimum average total cost the firm faces and the quantity associated with that cost. PRICE (Dollars par bat) 80 70 60 20 MO о о 10 20 40 ATC 60 QUANTITY (Thousands of bas) Demand Man Camp Outcome Min Unit Cost Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact that optimal quantity. Furthermore, the quantity the firm produces in long-run equilibrium is average total cost. at the the quantity at which…
That is correct! Наpру Economics Mentor Okay, I think we can now determine what kind of market you operate in. Kim There are four main types of markets: perfectly competitive, monopolistically competitive, oligopolies, and monopolies. Kim The corn market- an agricultural market – is which kind of market? Kim a monopolistically competitive market an oligopoly a perfectly competitive market a monopoly Submit
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