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11. Three oligopolists, A, B and C, produce an identical product, Q. Q is produced under conditions of constant costs, that is, AC = MC = $100. The market demand schedule for Q is: Price Quantity Demanded $1,000 0 950 25 900 50 850 75 800 100 750 125 700 150 650 175 600 200 550 225 500 250 450 275 400 300 a) A, B, and C decide to act illegally as a cartel, to divide the market equally among the three of them, and to set the price and output that will maximize their total profits. What price and output do they set? What is the output level that each of the firms agrees to? What profit is earned by each firm and by the three firms together? b) A is impressed with the honesty of B and C, and believes they will keep to their agreements. They do, and A cheats by increasing output by 25 units. What is the new market price? How have the profit levels of A, B, and C changed? How have total profits in the industry changed? c) What actions are B and C likely to take in retaliation? Show how these actions will affect the market price, and the profit levels of the three firms. d) What can you learn from this problem about the likely stability of a cartel?
Relatively little pollution is emitted initially in the production process, but as the factory is used more intensively, pollution per unit of output increases and Explain how the introduction of this policy will affect the production decision of f..
Explain in one or two paragraphs why innovation is at the heart of creating and sustaining competitive advantage for firms. You need to mention the interrelationships between innovation and productivity
Local steakhouses suffer from the popularity of sushi and start incurring losses. What will happen to the number of steakhouses in town in the long run? Explain your answer.
1. How might freeing up dead capital have helped to increase Mongolia's rate of economic growth 2.What type of investment would foreign residents undertake if they were to purchase a small fraction of the shares of stocks owned by Mongolia's ..
I need to determine if a movie rented from Redbox is or is not in the same market as a movie seen at a Movie Theater. I know both items are related because they deal with the same product movies.
What are the contributions of these transactions to GDP in the years 2013 and 2014?
BudgetSurplus: The amount by which government revenues exceedgovernment expenditures in a given year. PublicDebt: The total accumulation of the FederalGovernment's total deficits and surpluses which have occurredthrough time.
Examine of taxation is complex and the issues you should address when looking at taxes are: the revenue increased, the equity of tax, and the efficiency of the tax.
Among the problems that hinder growth in developing economies are poor infrastructure, lack of financial institutions and a sound money supply, a low saving rate, poor capital base, and lack of foreign exchange. Explain how these problems are inte..
The long run supply curve for a particular type of kitchen knife is horizontal line at a price of dolla three per knife. The demand curve for such a kitchen knife is
Compute the physical units of production. Compute equivalent units of production for materials and for conversion costs. Determine the unit costs of production.
Professional football teams sometimes charter airplanes to take them to their away games. Would you feel safer on a United Air Lines plane that had been chartered by the Washington Redskins than on a regularly scheduled United Air Lines flight
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