Market Share (% Suppose that the table shows market share data for all of the Restaurant sushi restaurants in town Ahi Sushi 45 25 Shizuoka Calculate the Herfindahl-Hirschman index (HHI) for the local sushi market. Yoshinos 15 Ono Sushi 10 Arigato НHI:
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- Here is the revenue of four companies in the cable industry (hypothetical, but close to real). Please determine an HHI value based on this data. Pretend the entire market is just these 4 firms (note: this is revenue, not market share). Comcast $105 Billion Charter/Spectrum $50 Billion Cox $10 Billion Altice/Optimum $5 Billion What is the HHI value?Fa 3. What is the HHI in the search engine market if Google has 67% market share, Bing has 18% market share, Yahoo! has 11% market share, Ask has 3% market Spri share, and AOL has 1% market share? Fa 2. A strongly competitive market is characterized by a HHI of Spri Greater than 1,000 Less than 2,400 Less than 1,000 Zero Fa 1,877 4,489 9,998 4,944 5. Looking at the typical Kinked Demand Curve, why are most Oligopoly firms reluctant to increase the price of their product on their own? Spri increase would lead to a lower total revenue. They would be then exposed to an inelastic demand for their product and the pric They would be theri exposed to an elastic demand for their product and the price increase would lead to a increase total revenue. They would be then exposed to an elastic demand for their product and the price increase would lead to a lower total revenue. No Oligopoly is reluctant to increase priceBased on the figure below, which one is true about the 'Gym Accessories' industry? Gym Accessories 500 450 400 Sales (Million) 350 300 250 200 150 100 50 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Year O In 2007, market growth and rivalry were both low. O In 2007, market growth was low and rivalry was high O In 2015, market growth was low and rivalry was high. O In 2015, market growth and rivalry were both high.
- 1. Exercise 16.2 An industry is composed of Firm 1, which controls 50 percent of the market, Firm 2 with 30 percent of the market, and Firm 3 with 10 percent of the market. About 20 firms of approximately equal size divide the remaining 10 percent of the market. What is the Herfindahl-Hirschman Index for the industry? (Hint: Assume the 20 firms that make up 10 percent of the market constitute one firm.)What will the Herfindahl-Hirschman Index be if Firm 2 and Firm 3 merge? (Hint: Assume that the combined market share after the merger is 40 percent) Based on the HHI scores, will the government consider the merger of Firm 2 with Firm 3 to be procompetitive or anticompetitive? Anticompetitive ProcompetitiThe Camera Shop sells two popular models of digital SLR cameras (Camera A Price: $240, Camera B Price: $300). The sales of these products are not independent of each other, but rather if the price of one increase, the sales of the other will increase. In economics, these two camera models are called substitutable products. The store wishes to establish a pricing policy to maximize revenue from these products. A study of price and sales data shows the following relationships between the quantity sold (N) and prices (P) of each model: NA = 195 - 0.5PA + 0.35PB NB = 300 + 0.06PA - 0.5PB Construct a model for the total revenue and implement it on a spreadsheet. Develop a two-way data table to estimate the optimal prices for each product in order to maximize the total revenue. Vary each price from $250 to $500 in increments of $10. Max revenue occurs at Camera A price of $ - Max revenue occurs at Camera B price of $ -4:40 PV E Yo LTE ll 87%I The ethanol bubble_Gro... O More Aplia Econ Blog News for Econ Students MONDAY, NOOVEMBER 05, 2007 The Ethanol Bubble? by William Chiu The New York Times reports that in less than one year, ethanol prices have plummeted over 30%. As a result, there is even talk of a government bailout for ethanol producers in case the price of ethanol falls too low! So, why did price spikes in last year's ethanol market give way to falling prices this year? To understand the price fluctuations, we need to know how the short-run behavior of firms in competitive industries (such as ethanol) differs from their long-run behavior. In the textbook model of perfectly competitive industries, an increase in demand causes the equilibrium price of ethanol to increase in the short run-from P1 to P2 in the diagram below. In the short run, higher ethanol prices lead profits for ethanol producers. higher PRICE OF ETHANOL PRICE OF ETHANOL MC ATC PROFIT 02 42 MARKET QUANTITY OF ETHANOL FIRM…
- This question is inspired on the recent evolution of electricity markets in Switzerland and the EU.Suppose a market consists of three producers:i. Firm 1 (photovoltaics) has a marginal cost of production od CHF 1 and can produce up to 100 MW/h;ii. Firm 2 (hydroelectric) has a marginal cost od production of CHF 5 and can produce up to 200 MW/H;iii. Firm 3 (gas) has a marginal cost od production of CHF 20 and can produce up to 200 MW/h.For simplicity, assume that there are no fixed costs of production.Consumers are willing to pay a constant amount of 25 CHF for each additional MW/h up to 500 MW/h. a) Draw a graph of supply and demand for this market.b) Calculate the price in the market and the profits of each company.The closer a market's Herfindahl - Hirschman Index (HHI) is to there are firms in the market. A. 100; many B. 10,000; few C. 100; few D. 10,000; many the less competitive the market, which meansPLEASE TYPE Suppose an industry that has 10 firms. Below are the market shares for 2008 and 2013 of the 10 firms. Market Share Firms 2008 2013 A B C D E F G H I G 26% 21% 16% 10% 9% 7% 4% 3% 2% 2% 22% 23% 19% 9% 8% 7% 6% 4% 1% 1% Using the CR4, CR8, and HHI, analyze the evolution of the potential market power of firms in the industry.
- Use the graph above to answer these questions: What is the profit-maximizing level of output? What is the economic profit? What is the per-unit amount of profit at the profit-maximizing level of output?In 2017, two beer drinkers in California filed a lawsuit against Kona Brewing Company, which sells Kona beer. The beer drinkers claimed that Kona was marketed as if it were brewed in Hawaii, but the beer is actually brewed in Oregon, Washington, Tennessee, and New Hampshire. Source: Cameron Miculka, "Suit Alleges Misrepresentation by Kona Brewing Co. Owner," westhawaiitoday.com, March 3, 2017. If the market for beer were perfectly competitive, the location of breweries would A. be in the same geographic area. B. not matter to consumers since the product would be homogeneous. C. be outside the United States. D. not matter to consumers since the product would be heterogeneous.1. Suppose you are the economic adviser of a company producing three brands of mobile phones; Nokia 10, Samsung X and iPhone Z. Suppose further that, your company currently sells 120 Units of iPhone Z at ¢800 per unit, 150 units of Samsung X at ¢800 per unit and 200 units of Nokia 10 at ¢100 per unit, but in a bid to maximize profit, the company’s managing director proposes an increase in price of Samsung X from ¢800 to ¢1000 per unit for which quantity demanded is anticipated to fall from 150 to 100 units; iPhone Z from ¢800 to ¢1200 per unit for which quantity demanded is anticipated to fall from 120 to 100 units; and Nokia 10 from ¢100 to ¢200 per unit for which quantity demanded is expected to fall from 200 to 100 units. I. Using the mid-point formula, compute the price elasticity of demand for each brand. II. From your answer in i, what is the type and economic interpretation of each brand’s value of elasticity
