User Account

All Pages

How much money will downstream manufactuers make

Assignment Help Econometrics
Reference no: EM13241814

Assume that the marginal cost to Microsoft of supplying its operating system for one more computer is zero. Denote by PM the price charged by Microsoft for its operating system.

Various computer manufacturers produce homogenous computers. Cost of production per computer is equal to $1000 + PM where the $1000 captures other computer component costs, such as the microprocessor, monitor, etc. Finally, assume that the downstream computer industry is perfectly competitive and aggregate demand is given by Q = 50,000,000 - 10,000P .

a. For any given price, PM , of operating systems, what will be the price and sales of computers?

b. What price PM should Microsoft set for its operating system? How much money will downstream manufactuers make? What will be the final price of a computer?

c. How much money would a vertically integrated firm controlling both the supply of Windows and the assembly of computers make? What price would such a firm charge for its computers?

d. Should Microsoft integrate downstream with computer manufacturers?

Reference no: EM13241814

Questions Cloud

Formulate a hypothesis related to statement : Why, in my day, kids were much more respectful and didn't cause as much trouble as they do nowadays!" Formulate a hypothesis related to statement that you could test. How would you test it?
A historical analysis of urban planning in the united states : A clear thesis statement An annotated bibliography for at least 10 scholarly or professional journal articles A summary that expresses the overall plan of the paper, including subtitles and topic sentences for each subtitle provided.
Calculate the electric potential energy : The liquid-drop model of the atomic nucleus suggests high-energy oscillations of certain nuclei can split the nucleus into two unequal fragments plus a few neutrons, Calculate the electric potential energy (in electron volts) of two spherical fragm..
Indicate the probable motivation for rpm : The fashion (clothing), consumer electronics, fine fragrance industries are knwon to practice or have practiced resale price maintenance. In each case,indicate the probable motivation for RPM and the likely welfare consequences.
How much money will downstream manufactuers make : Various computer manufacturers produce homogenous computers. Cost of production per computer is equal to $1000 + PM where the $1000 captures other computer component costs, such as the microprocessor, monitor, etc.
Find the time constant of the circuit : A capacitor is charged to a potential of 12.0 V and is then connected to a voltmeter having an internal resistance of 3.10M, What is the time constant of the circuit
What is the difference between customer satisfaction : What is the difference between customer satisfaction and customer loyalty? Why is it important to distinguish between these two concepts?
Determine at what level of output does smc equal avc : Use a computer regression package or Excel to work this computer exercise. Palm Products Company has collected data on its average variable costs of production for the past 12 months.
Find the maximum speed achieved by the sphere : Two plastic spheres, each carrying charge uniformly distributed throughout its interior, are initially placed in contact and then released, Find the maximum speed achieved by the sphere of mass 50.0g

Reviews

Write a Review

Econometrics Questions & Answers

  Determine what is the present value

determine the present equivalent value of the cash flow diagram when the annual interest rate, ik, varies over time n = 6 years with 4 cash flows year (1) = $1,000 (2)= $2,000 (4)= $1,000 and (6)= $2,000 between each year the interest changes

  Determine the annual effective interest rate

You have just applied for a credit card with the following term and condition: You are to pay 13.9% APR, compounded monthly.If your current balance is $3000 and you skip payments for 2 months, what would be the total balance in your credit card stat..

  Why production is exactly the same at a price ratio

d. explain why the production possibility frontier of part c is concave. e. sketch the realtive price of food as a function of its output in part c. f. if consumers insist on trading four units of food for five units of cloth, what is the relative pr..

  What is the difference in the amount of depreciation

A construction company is considering changing its depreciation from the MACRS method to the historical SL method for a general purpose hauling truck. The cost basis of the truck is $100,000, and the expected salvage value for depreciation purpose..

  Calculate the money multiplier in mm

Suppose that due to whatever reason, reserve demand changes and you forecast the reserve demand to now be Rd = 270 - 30 iff. In order to keep the federal funds rate at target, what must the open market desk do? Be specific and show this developmen..

  Discuss the signs of the coefficients of the model

Consider the general two-commodity market model: QD1 =  f0 +  f1P1 +  f2P2 QS1 = a0 + a1 P1 + a2P2 QD2 =  f0 +  f1P1 +  f 2P2 QS2 = b0 + b1P1 + b2P2 where the f and a coefficients pertain to the demand (QD1) and supply (QS1) functions of the first co..

  How much would be in the account at the end of 15 years

A company deposits 2000 in the bank at the end of every year for 10 years. The company makes no deposits during the subsequent 5 years. If the bank pays 8% intereest, how much would be in the account at the end of 15 years

  How much will he owe the bank at the end of 3 years

A man borrowed 750 dollars from a bank. He agrred to repay the sum at the end of 3 years, together with the interest at 8% per year. How much will he owe the bank at the end of 3 years

  Determine what is the cost of common equity

The earnings, dividends, and common stock price of Carpetto Technologies Inc. are expected to grow at 8% per year in the future. Carpetto's common stock sells for $27.75 per share, its last dividend was $1.50, and it will pay a dividend of $1.62 a..

  How much will the total income of the town grow by

A certain town has yearly exports that total $40 million. It has no imports. The town's marginal propensity to consume residence expenditures from their income is 0.15 The town's marginal propensity to spend on other things is 0.65

  What is the yield-return on the bond

A corporate bond has a face value of $10,000 with a bond rate of 6%. The interest of the bond will be paid quarterly. The bond will mature in 10 years. If the bond is sold at $7,000 on the market, what is the yield (return) on the bond

  What would be the contribution to us gnp and gdp

Save U More, a grocery in Iowa, purchased 2000 lbs. apples from an Iowan farmer at $0.4 per pound. The grocery store sold 1500 lbs. of the apples as fresh apples at $0.9 per lb., used the rest (500 lbs.) to make 200 gallons of apple cider, and sol..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd