Macroeconomics
13th Edition
ISBN: 9780134735696
Author: PARKIN, Michael
Publisher: Pearson,
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Question
Chapter 15, Problem 6SPA
(a)
To determine
Identify the airline mergers in terms of increasing fares or lower airline production costs.
(b)
To determine
Identify that how lower costs might be passed on to the travelers or boost the airlines’ profit.
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Students have asked these similar questions
Merger of beer giants faces obstacles
Mega-brand beers have lost market share to wine and craft beer. In response, Anheuser-Busch InBev and SABMiller, the two biggest brewers in the world, are discussing a merger that would be scrutinized by antitrust regulators.
Source: The New York Times, September 16, 2015
How would a merger benefit the two big brewers? Under what circumstances would the Federal Trade Commission (FTC) challenge the merger?
A merger would benefit the two big brewers because
O A. the price of beer would fall close to the price in a perfectly competitive market and sales would increase
O B. average total cost would increase but price would increase by more than average total cost
O C. the price of beer could rise close to the monopoly price and economic profit would increase
O D. many craft brewers would be forced out of the market
The Federal Trade Commission would challenge the merger if
O A. it increases the HHI
O B. the HHI is less than 1,500
O C. the HHI is…
Theory says that oligopolies should stick to the $500.00 price to maximize revenue (see the graph)
Use the graph pictured to calculate total revenue in the elastic and inelastic portions of the demand curve at the price and quantity points specified to explain the theory.
Macmillan Learning
(Figure: Pay Per View Movies on Xfinity Cable) Use Figure: Pay Per View Movies on Xfinity Cable. The figure shows the
demand and marginal revenue curves for on-demand movie rentals on Xfinity. Assume that marginal cost and average cost
are constant at $20. If the cable company has market power, what price will it charge?
Price,
Costs,
Marginal
Revenue
$100
90
80
70
60
50
40
30
20
10
1 2 3
MR
4 5
6 7
8 9
DO
D
Chapter 15 Solutions
Macroeconomics
Ch. 15.1 - Prob. 1RQCh. 15.1 - Prob. 2RQCh. 15.1 - Prob. 3RQCh. 15.1 - Prob. 4RQCh. 15.2 - Prob. 1RQCh. 15.2 - Prob. 2RQCh. 15.2 - Prob. 3RQCh. 15.2 - Prob. 4RQCh. 15.2 - Prob. 5RQCh. 15.2 - Prob. 6RQ
Ch. 15.3 - Prob. 1RQCh. 15.3 - Prob. 2RQCh. 15.4 - Prob. 1RQCh. 15.4 - Prob. 2RQCh. 15.4 - Prob. 3RQCh. 15.4 - Prob. 4RQCh. 15.4 - Prob. 5RQCh. 15 - Prob. 1SPACh. 15 - Prob. 2SPACh. 15 - Prob. 3SPACh. 15 - Prob. 4SPACh. 15 - Prob. 5SPACh. 15 - Prob. 6SPACh. 15 - Prob. 7SPACh. 15 - Prob. 8SPACh. 15 - Prob. 9APACh. 15 - Prob. 10APACh. 15 - Prob. 11APACh. 15 - Prob. 12APACh. 15 - Prob. 13APACh. 15 - Prob. 14APACh. 15 - Prob. 15APACh. 15 - Prob. 16APACh. 15 - Prob. 17APACh. 15 - Prob. 18APACh. 15 - Prob. 19APACh. 15 - Prob. 20APACh. 15 - Prob. 21APACh. 15 - Prob. 22APACh. 15 - Prob. 23APA
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