Price and quantity combination of profits

Assignment Help Macroeconomics

Reference no: EM1312128

During recent years, MBI, Inc. has enjoyed substantial economic profits derived from patents covering a wide range of inventions and innovations. A recent software product, QuickerBetter, has proven especially profitable. Market demand and marginal revenues for this software product are:

P = $5,500 - $0.05*Q

MR = $5,500 - $0.10*Q

Where P is the product price, its quantity sold is Q and MR is the marginal revenue of the product. Fixed costs are zero since the research and development expenses have been fully amortized in previous periods. Average variable costs are constant at $4,500 per unit.

1. Calculate the price/output combination and the total economic profits that would result if competitors offer clones that make the QuickerBetter market competitive.

2. What are the economic tradeoffs of allowing patent protection and effective monopolies from a societal perspective? Explain.

Reference no: EM1312128

Questions Cloud

Suppose the wheel has constant negative angular acceleration : A 3.60 long, 420 steel beams extends horizontally from the point where it has been bolted to the framework of the new building under construction. A 72.0 construction worker stands at the far end of the beam. What is the magnitude of torque about the..

Assumption of independence of risks matter in the examples : Why does the assumption of independence of risks matter in the examples of insurance.

Decision on lease or buying the home : Determine whether it is financially more attractive for the Bergholts to rent or to purchase the home over a five-year holding period.

Determining probability of selecting a non-senior : Given that the student you choose is a senior, find out the probability of selecting a non-senior?

Price and quantity combination of profits : Compute the price or output combination and the total economic profits which would result if competitors offer clones which make the QuickerBetter market competitive.

Compute the total mechanical energy : An aluminium block of mass m1 = 3.45 kg and a copper block of mass m2 = 6.30 kg are connected by a light string over a frictionless pulley. They sit on a steel surface, where θ = 40.0°

Total quantity produced also firm profit : Find the total quantity produced also every firm's profit in equilibrium. Express Illustrate what happens to these when Firm 1 changes its technology as above.

Computing the interest earned for next years : Computing the interest earned for next years wants to invest equally amounts at the end of each year

Computing the mean for the given data : Determine the mean number of times the machine was used per day.

User Account

All Pages