The inverse demand for a homogeneous-product Stackelberg duopoly is P= 10,000 -4Q. The cost structures for the leader and thefollower, respectively, are CL(QL) = 3,000QL and CF (QF) = 4,000 QFa. What is the follower's reaction function?QF= 7500.1QLb. Determine the equilibrium output level for both the leader and the follower.Leader output:875Follower output:641c. Determine the equilibrium market price.$ 4,999d. Determine the profits of the leader and the follower.Leader profits: $1,619,531Follower profits: $ 999,506 ✪

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Answered: The inverse demand for a…

Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

Section: Chapter Questions

Problem 1CE

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The XY Manufacturing Company must decide whether to manufacture a component part at its plant or purchase the component part from a supplier. The resulting profit is dependent upon the demand for the product. The following payoff table shows the projected profit (in ten thousand of pesos): Decision Alternative Manufacture, d₁ Purchase, d₂ Low Demand $1 -100 50 State of Nature Medium Demand S2 200 225 High Demand S3 500 350 MA The state-of-nature probabilities are P(s₁) = 0.35, P(s₂) = 0.35, and P(S3) = 0.30. a. Use a decision tree to recommend a decision. b. Use EVPI to determine whether XY Manufacturing Company should attempt to obtain a better estimate of demand.
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A shop will decide to sell either product A or B or C in the coming season. Demand in that season can be high, average or low. Payoff table below shows the related returns in TL. You will create your own data for Product B row:)) States of nature Alternatives High demand Average demand Low demand Product A 2000 1000 -200 Product B Product C 1000 500 400 a. What would be the decision according to Minimax Regret? b. What is the maximum amount of money the company should pay for perfect information? (Assign probabilities for high, average and low demand)
Newsvendor model : A retailer orders sunscreens from Sweden. The firm wants to make a single purchase. Unit cost (?)(v) is $12 and sales price (?)(r) is $24. Unsold sunscreens will be salvaged (?)(s) at $8 each at the end of the summer. The management estimates that there is no significant goodwill cost (?=0)(g=0) for lost sales. Find critical ratio (?)(R). 0.75 0.33 0.25 4
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Large-scale integrated (LSI) circuit chips are made in one department of an electronics firm. These chips are incorporated into analog devices that are then encased in epoxy. The yield is not particularly good for LSI manufacture, so the AQL specified by that department is 0.15 while the LTPD acceptable by the assembly department is 0.40. Assume the company is willing to accept a consumer's risk of 10 percent and a producer's risk of 5 percent. Find the sample size. Use Exhibit 10.16. Note: if the exact value of the computed LTPD ÷ AOQ ratio does not appear in Exhibit 10.16, use the next higher ratio. Note: Round up your answer to the next whole number. How would you tell someone to do the test?
No probabilities are known for the occurrence of the nature states. Compare the solutions obtained by each of the following criteria: Hurwitz (assume that alpha = 0.8)
* An equipment which costs $15000 has to be replaced with a new equipment. The follovig data have been estimated - Year 3 4 Resale value 12000 9500 7500 5700 Annual maintenance cost 600 800 1050 1400 Year 7 Resale value 4200 3900 2100 2000 Annual maintenance cost 2100 3500 5000 6800 of Determine the optimal replacement period.
Please calculate the sensitivity analysis of NPV increase in 10%, 30%, and 50%. NPV (current) natural forest 70141.71 protective forest 123582.50 agroforestry & terracing 263.11 Beekeeping 198275.14 Cookstoves 61490651
Using the 1st law of Thermodynamics solve the following problem and the format of the answer is as follow a.) given:b) required:c solution : The 2M Company supplies 50 kilograms of chicken to ABEst Restaurant, which is contained in a box at 6°C, and is to be frozen at-18°C. The container box is 1.5 kg and the specific heat of the box material is 1.4 kJ/kg-°C. The freezing temperature of chicken is -2.8 °C. Determine the amount of heat that needs to be removed
What relationship between x and y is suggested by the scattergram? OA a quadratic relationship with downward concavity OB. a linear relationship with positive slope OC. a linear relationship with negative slope D. a quadratic relationship with upward concavity
Golden Company is in the period of budgeting for 2022. The Sales manager forecasted the number of units to be sold as 30000 units and determined the selling price as 40 OMR per unit. The management revised these estimates with a 10 % decrease in selling price and with a 20 % increase in the number of units sold. According to these estimates, which of the following is revised Sales (OMR)? Select one: O a. 1050000 Ob. 1296000 Oc 900000 O d. 675000

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