Appropriate horizontal- and vertical-axis intercepts

Assignment Help Business Economics

Reference no: EM13983911

The market for lemonade in a town consists of two lemonade stands (i.e., firms), 1 and 2. An agricultural economist estimates the following demand for lemonade in this town: Q = 300 - P, where Q is the market quantity and P is the market price. Total costs of the two firms are indicated below: TC1 = 60Q1 (such that marginal cost is constant at 60) TC2 = 40Q2 (such that marginal cost is constant at 40) Acting as Cournot competitors, find and graph the reaction functions of each firm (indicating appropriate horizontal- and vertical-axis intercepts). Determine the Cournot equilibrium output of each producer, as well as the profit of each producer.

Reference no: EM13983911

Questions Cloud

Political philosophies associated with income inequalities : Discuss tax systems and political philosophies associated with income inequalities. List and describe the relationship between the two tax principles and three tax systems discussed in this course. Include comments regarding the effects of tax on soc..

Inverse monthly market demand for tattoos : In the town of Inksville, Tats for Tots (i.e., TFT) is the only tattoo parlor dedicated to the under-18 age group. Being a monopolist, TFT hires you to advise it on the best price and quantity of tattoos to sell each month. Determine the values of P ..

How much will this firm want to sell to each consumer type : The Errata Book Company is a firm that sells its book to two types of consumers, type 1 and type 2. The marginal revenue Errata gets from type 1 consumers is: MR1 = 20 - 2Q1, and the marginal revenue Errata gets from type 2 consumers is: MR2 = 15 - 3..

The level of aggregate real income decreases : Monetary Policy Each of the following events will have one of the effects given below. Identify the correct effect by letter. Some answers may be used more than once and some may never be used. The level of aggregate real income (real GDP) decreases...

Appropriate horizontal- and vertical-axis intercepts : The market for lemonade in a town consists of two lemonade stands (i.e., firms), 1 and 2. An agricultural economist estimates the following demand for lemonade in this town: Q = 300 - P, where Q is the market quantity and P is the market price. find ..

Policies redistributes income across generations : Explain how each of the following policies redistributes income across generations. Is the redistribution from young to old, or from old to young? a. an increase in the budget deficit b. more generous subsidies for education loans c. greater investme..

Find optimal number of bottles to package together for sale : Suppose a typical consumer's inverse demand function for bottled water at a resort area where one firm owns all the rights to a local spring is given by P = 15 - 3Q. The marginal cost for gathering and bottling the water is $3 per gallon. Find the op..

What is meant by the concept of substitutes for leadership : Define power from an organizational behavior perspective. What is the difference between power and influence? What are the six forms of position power and the four forms of personal power? Briefly describe each form. What is leadership and how does i..

How does affecting the nominal federal funds interest rate : The federal reserve has power to adjust the nominal federal funds rate of interest. How do they do this? How is this different from quantitative easing? How does affecting the nominal federal funds interest rate address recessionary gaps in the econo..

User Account

All Pages